Re: "The World We're In" by Will Hutton

[Chris Burford <cburford@xxxxxxxxxx>]

It looks as if no one is stepping forward to say they have looked at this
book directly so I had better finger it as it is more likely to be
available in London and will be more influential here, not least on the
Labour government and Gordon Brown.


At 15/05/02 08:41 -0400, Louis Proyect
> Chris Burford:
> >Hutton is probably proposing Keynesian solutions. It would certainly not be
> >socialism. But even a capitalist programme really to eradicate global
> >inequality would be a big shock to the privileged populations of the
> >imperialist countries, let alone their bourgeoisies.
>
> A " capitalist programme to really to eradicate global equality" is a
> contradiction in terms, like democratic fascism or enlightened savagery.

Yes, ultimately that is a contradiction in terms. There is certainly a
dialectical contradiction between the incessant need for capital to
accumuate, and the limited purchasing power of the masses.

However the Marshall Aid programme after the war shifted capital back to
western Europe and produced an increase in the use values available for the
local population. Capitalism can continue even with a redistribution of
capitalism and of the circulation of commodities. (Consider Marx's argument
in "Wages, Price, and Profit against Citizen Weston")


> >This could only be overcome if Keynesian measures brought so much
> >underutilised means of production in the third world into play, (especially
> >their underutilised labour power) that the total social product of the
> >world increased substantially at the same time as surplus was invested
> >almost exclusively in the the third world. This would allow a great
> >increase in available use value in the world to disguise a massive
> >redistribution of exchange value, within the total social product of the
> >world.
>
> Keynsianism is an impossible course of action in 3rd world countries
> because their economies are too tightly integrated into the world
> capitalist system.


What limited defensive measures are possible is probably a rather detailed
discussion, but broadly I very much agree with this statement. I do not
know how robust Cuba's economic defences could be, and how it manages its
balance of payments. Can anybody forward a clip on this technical but
important point?

However my comments about a Keynesian solution to the "World We're In" was
an assumption that Hutton may well propose a Keynesian solution on a
*global* level. That is quite possible within capitalism.

Indeed the coordinated reduction of interest rates by central banks after
the Asian financial crisis, was a Keynesian solution based on the hope that
the USA would kindly act as the spender of last resort in the world, and
become an engine for growth behind which the rest of the world would
thankfully follow.


> The only option that makes sense is a proletarian
> dictatorship, a planned economy and a monopoly on foreign trade--in other
> words the Cuba model. It is also important to acknowledge that Keynsianism
> did not work very well in the first world when it was tried out. After all,
> it was WWII that lifted the USA out of a depression, not public works.
>
> >I presume this is a reference to George Soros. I would have thought that he
> >has been invited to a forum for commercial reasons of his  notoriety and
> >because he has argued for capital to be recirculated to the global
> >peripheries, (no doubt at public expense).
> >
> >Hutton, who is a fairly honest radical bourgeois, may well also be arguing
> >for capital to be redistributed to the peripheries.
>
> What does it mean for capital to be redistributed concretely? Banks have no
> trouble making loans to places like Chile or Jamaica.

At its most concrete and topical, within the last month  a foreign bank, (I
think a Canadian one) operating in Argentina suspended trading and
precipitated all the foreign banks suspending trading. At that point the
international capitalist community would have had to extend billions of
dollars of credit to the Argentine government so they could reassure the
imperialist banks that the crisis of circulation would not be at their
expense.

International banks have no problem making loans so long as they know
regulators of world finance capital will bail them out.

In some ways the Argentinian crisis is really about a battle within finance
capital: it is just the Argentinians that are suffering. It is almost a
game to the IMF as one of them tactessly revealed.

Instead of extending more international credit to allow transnational banks
to get their funds out to safer places, the IMF is considering the more
rational (!) solution of letting an entire country declare bankruptcy, so
that some of the burden would be shared by all the creditors. (Remember the
scandal when it became clear that a lot of the last IMF loan to Russia
ended up in Wall Street.)

But it is not quite true that "Banks have no trouble making loans to places
like Chile and Jamaica"- or at least the statement needs to be unpacked.
The hard nosed neo-liberals are pointing to the argument that there is a
great shortage of commercial capital investment in the developing world as
a whole. Therefore they say, the only aid that should be given is to
improve their internal standards of business practice and accounting
(Andersons is not mentioned in this context however) to make them more
attractive recipients of speculative investment.


> If this is what you
> mean, then that's like recommending tobacco to somebody with lung cancer.
> If, on the other hand, you mean the kind of arrangement the USSR had with
> COMECON, which effectively subsidized the Cuban and Eastern European
> economy, then I'm for it.

Without approving everything in the former Soviet Bloc, it is clear that
one dimension of its collapse was when it could no longer managing its
finances as a bloc versus the capitalist world led by the USA.

As well as the important class question of what forces are being
represented by any particular financial regime, there is also a technical
question. Under certain conditions these arrangements are possible.


> Of course, people like George Soros, Tony Blair
> et al are obstacles to that. In any case, the two roads are incompatible.


I think Soros and Blair are both utterly conscientious systematic and
scientific opportunists. Soros will have picked up more than a passing
familiarity with the workings of the eastern bloc economics, and has for
example invested some of his pickings back in Hungary. Blair, like Clinton,
is probably wondering what prestigious international jobs await him in his
sixties in a rational neo-liberal world where the worst excesses of
capitalism are mitigated by skilled managers of total societies like himself.

He may be able to mitigate, but not abolish, the fundamental contradictions
of capitalism.

Chris Burford