On global capitalism in Lenin’s day, the Bolshevik leader had this to say: “Imperialism is an immense accumulation of money capital in a few countries … hence the extraordinary growth of a class, or rather, of a stratum of rentiers, i.e., people who live by “clipping coupons”, who take no part in any enterprise whatever, whose profession is idleness …” If only the money men of 21st century Britain remained excrescences on the economy, of directing their stooges to invest capital and growing fat off the labour and talent of others. At the risk of being wistful, this ideal-typical view of your average capitalist is long buried and have gone beyond mere uselessness. Drunk on their parasitism, they are oblivious to how their appetites are not just imperiling the health of the enterprises they gorge upon, but threaten to kill them outright. Continue reading
After two days of trouble and strife in global stock markets, the Federal Reserve’s New York President William Dudley said in remarks to reporters that a September interest rate hike seemed “less compelling” now than in recent weeks. These two words alone calmed global financial markets, and pushed up the price of oil.
So everything’s going to be all right then? That is what some would have you believe. “Relax. Its just a correction” say the analysts. “The stock market always goes up and up and up. Hang on in there.” However, I do worry. Where there’s volatility and instability, the causes are ultimately fundamental. Given this week’s events what can they be? Is it all to do with China?
I doubt it. When the governors of the People’s Bank of China announced a cut in interest rates – stock markets continued to fall. When a Fed governor uttered two words off the cuff – markets rallied. So when looking for a cause we need to look west, not east. Continue reading
It is curious that the main charge thrown against Jeremy Corbyn – apart from all the bluster and hysteria – is that his policies lack ‘economic credibility’. The assumption presumably is that the economic policies pursued by UK governments, both Labour and Tory, as well as by the EU, were sufficiently credible and rewarding as to justify or even necessitate their continuing to be followed. Even a second’s thought shows that that is an absurd proposition. The business model of free market de-regulated capitalism which has been ruthlessly taken to extremes over the last 3 decades is patently bust. It led inexorably to the biggest global breakdown for nearly a century, followed by the longest recession and the slowest recovery since the 1870s – indeed a secular stagnation with still no recovery in sight. Continue reading
The IMF is the last place that one would expect to hear the argument being made that inequality has gone far too far. So the recent detailed research from the citadel of capitalism has to be taken seriously. What they found was that raising the income share of the poorest fifth of the population increases growth by as much as 0.38% over 5 years, whilst increasing the income share of the richest fifth by 1% actually reduces growth by 0.08%. On that basis the argument that enriching the rich yet further benefits everyone collapses. Trickle-down which both Thatcher and Blair devoutly believed in is therefore seen for what it is – merely a rationalisation to justify their hold on power and wealth. Continue reading
Immigration and benefits. Immigration and benefits. Immigration and benefits. I can barely remember a time when these weren’t commanding headlines or the imaginations of politicians. One might say that this is no surprise, seeing as they are both hot button issues for the public – though it might be said these issues are fabricated and amplified by those with vested interests to do so.
Left critics of this kind of pernicious scaremongering rightly call it out for what it is: the politics of divide and rule. I’ve done it myself. That, however, is as far as it goes. Too often the deeper political economy, the economic pressures of which politics is but a concentrated impulse, either remain unexplored with regard to these matters or, when they are analysed, they tend toward crude conclusions and deeply problematic politics. Continue reading