The Economy, a Merry-Go-Round

Today Free World economists and writers admit Capitalism is falling off a cliff; and try to patch up the old cadaver. How? By lying. Impossible they say for all to produce goods. Only the Great may. But Capitalists produce cheaply abroad for profit.

The Economy, a Merry-Go-Round

Fernando García Izquierdo

Probably I am not qualified to write about economic science. When I was in employment, the law was my province; I did study political economy at university and even got my degree; but I have never considered myself an economist. Therefore I would loathe to be seen as a ‘meddler’, writing about these things or to appear as censuring a writer who certainly knows what she is producing. I always read the two columns which Rana Foroohar writes in ‘Time’, and have learned a lot reading her. So I am not altogether a stranger in these matters.
Last week (November 18, 2013) her article gave me a good deal of necessary information. That is why I have decided to write today. Ms Foroohar must be a very intelligent person, being able to embody, in just a few lines, so many of the matters that interest us so much at present.

Now, about that ‘Sparring between US and Germany’.
No need to fear, Ms Foroohar. For Germany ( as West Germany before) is the best ally America has nowadays and has had these sixty years. The country that came out thoroughly devasted from the latest world war knows exactly what she owes to the United States of America. And Frau Angela Merkel more than anybody; for she (we are told) lived once under the Communist Boot, and perfectly knows who is the enemy.
Nor need anyone fear that ‘the Germans and their export-focused (or whatever) policies’ may be the cause of ‘Europe’s debt woes’. First, Germany (glad to have all of us in her lap) will not cause us any woes. Secondly, Germany herself is declining like the rest of us: she is only trying to survive. And thirdly, if we are going to talk of Europe’s woes, please note that those woes are not only ‘debts’, or such phantoms as ‘subprime-mortgages’, ‘competitiveness’, ‘forced productivity’, ‘minimum wages’ and so on. They’re woes of quite another nature, i.e. the swift unavoidable approach of total collapse, like the rollers in the ocean which you see coming on and breaking on the sand with such a terrible thud, causing you a terrible fright. Gone! Yes, Capitalism is on its last legs.

Can we really say that ‘Germany is essentially the China of Europe’?
I doubt it. Germany is an absolute tragedy, believe it or not. And since everyone agrees that China is progressing, progressing, progressing… I fail to see where Ms Foroohar finds her ‘essentially like China’.
It hits you in the eye that in production, growth, culture, wellbeing, rising standards of living, full employment, salaries and wages… Germany has gone down, probably never to go up again.
I had better explain all this with a parable (since we’ve spoken of a tragedy above.)
Quevedo, a sixteenth-century Spanish satirist, already warned us against wilful-thinking. One may believe one is the Best, and then it turns out that everything is relative. The favourites of the Devil, the satirist said, should only expect the privilege of being the last to be devoured.
That is where Germany stands. She is just a tiny bit better than the others and she will last longer, but into the cauldron she shall go, like the others. Germany is embarked in the same boat as Spain, Ireland, Italy, Cyprus, Romania, and the rest. Everybody knows that. And the result of the sailing has to be the same for all. She’ll be the last one. But it is not much.
Or putting it somewhat differently: the country that seems to us to be doing best is still doing very badly. All very ugly. Like in the stories read to us by our mums when we were little kiddies: ‘In the land of the blind, the half-blind stalks about most proudly, looking like a king’. But he is not. Or that other story of a proud blond queen who thought she was bearing a beautiful golden robe…, until a little boy in the crowd cried: ‘The queen is naked! she is a fake!’

Communist China at least has wealth aplenty.
To be sure China does not produce such exquisite things as German capitalist manufacture does (I notice that Ms Foroohar uses the term Manufacture instead of Industry.) In old cities like Köln, Leipzig, Iena and others, there is still some industry going on, and good things are still being made. And as China has the means to purchase, she purchases the goods. But how long is this ‘rapport de forces’ going to last?
Two considerations seem to me relevant in this respect: 1) Communist China has trillions of US dollars, in its Central Bank, and 2) The Federal Reserve (or whatever) has a debt of trillions of US dollars, which it will soon be unable to pay. Why is this so? How was this ‘rapport de forces’ created? I would like professional economists to explain it. To me the whole thing is clear as daylight… it means, we are only moved by greed and love of profit.

The wealth of nations.
At the beginning the capitalists showed that the way to produce was employing jointly labour and capital. The capitalists, today, are seeking how to dispense altogether with the element labour, the workers.
But the people of the Free World have to eat, the workers, ex-workers, all the unemployed. What, then? The Scoundrels who lead our nations do not care about the workers. And production? They believe that robots, clever inventions and registered patents, will do the job. Besides, they can exploit the peoples of the rest of the world.
It is very funny to see that in War too. The capitalists are dispensing with ‘their hands’, which at that level mean ‘soldiers’. When the Great Satan invaded Vietnam (half a century ago) hundred of thousands of Marines and troops were deployed, tens of thousands subsequently died and many returned home quite disabled. ‘Our boys!’
And today, science, inventions and discovery, all along the line, are giving the capitalists the opportunity of waging war without soldiers. The same Pentagon which yesterday sent the boys to the slaughter house, now uses drones and all kinds of very ingenious devices (sophisticated, they say) to do the job. There is ‘competiveness’ for you, Frau Chancellor Angela Merkel!!

‘What has changed is growth,’ we read in Ms Foroohar article.
As we have said, Growth is the essential character of the system, and of which the capitalists formerly boasted. Wealth cannot be accumulated if there is no growth. But since the start of the Crisis there is practically no growth. We are all agreed in this. Thank you for telling us, Ms. Foroohar.

‘From 2003 to 2007,’ we read, ‘the world economy expanded faster than ever before’. And since then (2008) ‘growth has fallen off a cliff.’ Moreover, we are told by the journalist, ‘every country is focusing in how to grow.’ Good news.
The point is that it doesn’t matter what every country may be focusing in. And no figures are needed. It is all obvious. This observation, under capitalism not only growth has disappeared; but in addition things are now going down at a terrific speed. Perhaps we should concentrate on how to stop this descent.
There is only one way of doing this, in my opinion: changing the System immediately. Five years is too much to withstand the terror of nearly full unemployment, which is one of the horrors. Capitalism is leading us to disaster.
In Spain I have lately seen young unemployed people by the thousand, who would be unable to go into employment at all. They sometimes are offered jobs, and cannot do them. They have lost the habit, there is no longer that knowledge, that touch, cooperation, etc. and often are unable to get up in the morning in time to go to work, if offered a job. Lots of young men and women nowadays spend the nights in the streets, singing, drinking and dancing like the characters of the musical Carmina Burana. Then, as from 5 a.m. to 10 a.m. or later, they are in their beds. They have been following this ‘pattern of life’ for four or five years, and have lost the capacity to work, or as they say to be in society, ‘la vie active’, as the Freench say. Capitalism has ruined them.

‘Where is the rub, then?’ we are asked.
‘If Germany and the United States export more, others sell less.’ This is self-evident. A schoolchild of eight could figure that out. Is it not true that capitalism has always been ‘export-focused? Did not England, already in the nineteenth century impose her cheaper textile produce on the Southern Asian continent (destroying in passing the precious Indian textile industry)?

It is not whether the United States or other countries of the Free World sell less what interests us. There are other things more important to take into consideration and we all know what these things are. In consequence the rub is in understanding that we are humans, that humans are social beings, that a community of social beings must seek the wellbeing of all its members.

Instead we hear that ‘since manufacturing as a whole still doesn’t create as many jobs as it did a couple of decades ago, everybody is competing for a smaller slice’. Competiveness again!! And why Industry cannot create, cannot produce, cannot create jobs… Those are the questions.

Perhaps capitalism is not meant ‘to create as many jobs as it did’?
And why not? Because capitalism does not care about jobs or about workers. It was never ‘meant’ to care. Capitalism was always only meant to create profits. This is evident for anyone who has studied economic history. What is ‘new’ is that now the capitalists are acting more shamelessly than ever before. Since 1944 they have been fighting communism, out of greed, and have destroyed part of the planet. History will forever record this. And since the defeat of the Soviet Union the capitalists lost all fear. The proof, in the article we are just considering, the journalist draws our attention to ‘Germany’s anemic pace of domestic demand growth’, while at the same we see that Germany is number one in the production of some commodities. Germany is number one vendor, the local capitalists accumulate, accumulate and accumulate. Nobody can deny this. What may this anemic domestic demand signify?

Freeworld economy is today as dysfunctional as in 2008?
Five years have elapsed since the beginning of the Crisis, and Time magazine reports quite solemny that our capitalist economy is not functioning and has never functioned since 2008. Too late to start now to correct any dysfunctioning, after five years! It is not malfunctioning, but rottenness, what we are contemplating. That much for ‘Time’.
There are other harbingers of bad news. I read the other day in ‘The Economist’ (somebody lent it to me and I had to peruse it rather quickly, forgetting to note the date), and, if I understood it correctly, said weekly has reached the conclusion that inflation ought to be allowed to rise. The argument goes on as follows. If money is constantly being devalued (that is what, I think, inflation amounts to), those who owe much money will gain. And as the banks, it is known, owe millions and billions (millions and billions of debts), it will turn out that, with inflation, lots of extra money will suddenly accrue to said banks. Banks being the quintessence of capitalism, the system will roll on and eventually recover. Our Free World, on the whole, will again become very prosperous! Our banks will lend money to the smart, and speculation will follow. The capitalist sun will shine very brightly.

The insolence and violence of the capitalist regime indeed knows no bounds. The honorable leaders of our society, after having led our world to utter ruin, now come out in the open and don’t show the slightest restraint. ‘All for us!’
To think that they are clamouring for the horrors of inflation to be repeated. This is absolutely madness!!


Commenting has now closed on this article.

The Indymedia Network

Latin America
United States
East Asia
South Asia
West Asia