An insightful interview in Frontline with the Egyptian economist Samir Amin.
The dominant view in the media and in policymaking circles is that the current financial crisis is the result of undue deregulation and the greed of a few in Wall Street. We feel that we need to go beyond the superficial and descriptive framing of the crisis and understand it historically and politically. What is your analysis?The financial collapse is only the tip of the iceberg. Under the surface there is a deep crisis of accumulation of capital in the real productive economy, and deeper even there is a systemic crisis of capitalism itself. Let us look at the tip of the iceberg first - the so-called financial crisis. This is not the result of mistakes or irresponsibilities of the banking system operating freely in a deregulated environment. This flawed analysis gives the impression that if regulations are put in place the crisis will be corrected. This has been the expected response of the G-20 in Washington, D.C. And this should not be surprising since the G-20's feeble declaration has been prepared beforehand by the International Monetary Fund [IMF] in concert with the G8.
I would like to submit another vision of this crisis, and for this we have to get rid of the notion of seeing this as a result of neoliberal globalisation. This is limiting because it is descriptive and not analytical. The reality of the current system is the extreme centralisation of capital and a limited number of large oligopolies, some 5,000 in number across the world, that control power at the global, regional and national levels. It is their decisions that are shaping the world. We are at a level of centralisation that is far higher and stronger than we were just 50 years ago. This extreme centralisation of capital has led to a fundamental shift in the logic of the management of the system - instead of investing in the productive economy to produce surplus value, of course with the exploitation of labour, the focus is now on the struggle to redistribute the profits of that surplus value between the oligopolies. This redistribution of profits among them is done through financial investments. Each one of them tries to widen its sphere of financial investment in order to redistribute the profits in its favour. These profits are of another nature - they are monopoly rents.
- Log in to post comments
Every economic downturn since the late 19th century has been labeled by socialists as the crisis that would bring down capitalism. True socialists are much like creationists. They refuse to believe that variation and selection can produce innovation. Their views are driven by how they think things [i]ought[/i] to be rather than by evidence. And they will always be around.
Maybe it's time to move beyond the tired old socialism vs capitalism debate and accept what reasonable people have been saying since, oh, 1930 or thereabouts -- a mixed economy is what's needed. There's still plenty to argue about, of course, since mixed economies can take a variety of forms and reflect very different prioritizations.
BTW, while deregulation and the greed of a few(?) on Wall Street has played a major role in precipitating our current financial mess, lets not ignore the many non-Wall Streeters whose greed also played a significant role. Stupid people who rushed to get onboard with "deals too good to be true" are responsible for their own stupid choices.
There's an interesting semantic issue in the call for a mixed economy. The economy, of course, always has been mixed. It couldn't much be any other way. The notion of a "pure" capitalism, unadulterated by government influence, is as much myth as the philosopher's stone. If socialists are economic creationists, then the free market fundamentalists are the economic homeopaths.
we have to get rid of the notion of seeing this as a result of neoliberal globalisation
True socialists are much like creationists. They refuse to believe that variation and selection can produce innovation.
time to move beyond the tired old socialism vs capitalism
Oh, what a lot of strawmen.
I can't help but notice that the world is much richer, much more pleasant for the average man than it was 50 years ago. Maybe the change in world financial structures increases the risk of short-run fluctuations. But maybe that price is worth paying for the economic benefits. Maybe there is no perfect system with constant growth and zero fluctuations.