Contribution to the Forum on the Global and Financial Crisis on 30 January 2009 at De Balie, Amsterdam
It is of utmost importance for the working class and the rest of the people exploited by the system of monopoly capitalism to discuss and clarify to themselves what they can and must do about the current grave financial and economic crisis. They are necessarily concerned about being ceaselessly victimized by the monopoly bourgeoisie, extending from the extraction of the surplus value in the process of production to the complexities of capital over-accumulation and abuses of finance capital.
BY PROF. JOSE MARIA SISON
Chairperson, International Coordinating Committee
International League of Peoples’ Struggle
It is of utmost importance for the working class and the rest of the people exploited by the system of monopoly capitalism to discuss and clarify to themselves what they can and must do about the current grave financial and economic crisis. They are necessarily concerned about being ceaselessly victimized by the monopoly bourgeoisie, extending from the extraction of the surplus value in the process of production to the complexities of capital over-accumulation and abuses of finance capital.
In this connection, I wish to point out certain facts in order to show in a comprehensive and profound way how the current grave crisis has come about and how the working class and the rest of the people have been exploited and oppressed on a global scale, especially in the last three decades under the signboard of “neoliberal globalization”. Consequently, it becomes easier to discuss what the people can and must do about the crisis in terms of raising their consciousness, organizing and mobilizing themselves for making protests and demands in order to bring about the necessary social change for the better.
I. Certain Facts About the Crisis
We must counter the one-sided, narrow, fragmentary and shortsighted explanations of the crisis in the US and on a global scale. These have been made by the industrial and financial magnates, their political agents, their academics and publicists in order to obfuscate the origin and development of the crisis, to continue the misrepresentation of monopoly capitalism as “free market” capitalism, to continue making the most out of the mess in the system of greed and to confound and confuse the people.
1. Whatever is the dominant policy stress of the imperialist state and the monopoly bourgeoisie, whether the policy is called Keynesian or neoliberal, it is in the very nature of monopoly capitalism to exploit and alienate the working class from what it produces, maximize the extraction of surplus value, raise the organic composition of capital and accumulate and over-accumulate both the productive and finance capital in the hands of the monopoly bourgeoisie, especially the financial oligarchy. Pressing down the wage level cuts down effective demand and results in the crisis of overproduction. Raising the organic composition of capital in order to increase productivity and competitiveness results in the tendency of the profit rate to fall. The recurrent and worsening rounds of boom and bust and recessions have been temporarily overcome by heavy doses of debt financing. The overall decline of US industrial production since the mid-1970s has been accompanied by an unprecedented financialization of he US economy. But ultimately the over-accumulation of capital (especially through the overvaluing of assets, the multiplication and spiraling of derivatives and the generation of fictitious capital through unregulated credit expansion for the purpose of monopoly control and speculation) leads to the super-large financial and economic crisis, like the Great Depression and what now portends to be the Greater Depression.
2. The so-called neoliberal or “free market” policy stress has been significantly distinct from the previous so-called Keynesian policy stress a) in unbridling and letting loose the naked self-interest or greed of the monopoly bourgeoisie as the driving force of the economy ; b) in blaming as the cause of the problem of stagflation the rising wage level and social spending by the US government in the 1945-75 period, instead of the recurrent crisis of overproduction, the over-accumulation of capital and the demand-pull inflationary effect of military spending (the arms race, overseas deployment of US military forces and the wars in Korea and Indochina); c) in seeking to make more capital and profit-making opportunities available to the monopoly bourgeoisie through the denationalization of the neocolonial economies, privatization of public assets, trade and investment liberalization and deregulation or removal of restraints on abusing the working people, the environment and the financial system, and d) in accelerating the centralization and concentration of capital (especially in the form of finance capital) in the US and a few other centers of global capitalism.
3. The monopoly bourgeoisie in the US and other imperialist countries has successfully waged a class struggle against the working class by using the imperialist state to attack the trade union and other democratic rights, to press down wages and erode hard-won social benefits, cut back on social spending and to deliver taxpayer money to the monopoly firms in the form of overpriced contracts in military production and continuous supply of fuel and other raw materials for strategic stockpiles, direct and indirect subsidies and insurance for overseas investments. At the productive base of society, the state guarantees the legal property right of the monopoly bourgeoisie in order to maintain the exploitative relations of production and provides the laws and coercive apparatuses to keep the working class under control. Even as it misrepresents itself as “free market” capitalism, monopoly capitalism has always used the state for purposes of exploitation and oppression. As the partner of private monopoly capitalism, state monopoly capitalism takes more forms than state ownership of enterprises, even as nationalization is a form that may become conspicuous in time of severe crisis.
4. In accumulating and over-accumulating capital, the US monopoly bourgeoisie has not been satisfied with the extraction of surplus value in the process of production, the privilege of tax cuts and grabbing of taxpayer money, access to the bank deposits and pension funds of the workers, expansion of credit and money supply in relation to deposits, the creation of derivatives that speculate on fluctuations in the stock, bond and currency markets and taking of superprofits on cheap commodities and debt service from the economic hinterland of the world. After inveigling millions of worker and middle class families to buy into the “hightech bubble” in 1995-2000 and making them lose their savings, the US imperialist state and the monopoly bourgeoisie drew the American households to the “housing bubble” from 2002 onwards at teaser interest rates at the beginning. This would promote an unprecedented level of consumerism based on the artificially rising housing values and further consumer credit (in addition to housing equity loans, auto loans, credit cards and so on). The “housing bubble” complemented the so-called military Keynesianism of Bush, which pump primed the US military-industrial complex but not the entire economy in terms of increased demand, employment and production. The new bubble was one more and a bigger device to fleece the American working class and ultimately to securitize debts, especially bad mortgages, and generate the most arcane forms of derivatives, like the collateralized debt obligations, asset-backed securities, credit default swaps and structured investment vehicles.
