The Capitalist Catastrophe - ICG

The Capitalist Catastrophe - ICG

Submitted by redtwister on December 15, 2005

1. Introduction

The catastrophe of capitalist society is not mysterious or impenetrable, nor faraway nor something for the future! On the contrary, it is the essential and living reality of bourgeois society, a product of its own limits. These limits are located within Capital itself and patently manifest themselves all over the world.

Each large cycle of economic expansion necessarily ends in a depression. To the development of the productive forces corresponds the imperious necessity of their destruction. All accumulation of wealth produces misery to a proportional extent. The concentration and centralisation of Capital carries with it a growing contraction of the possibilities for lucrative investment.

In opposition to all those who justify this system and who, each time that a new cycle of expansion develops, pretend that never again will there be another crisis, we communists- have always insisted on the intrinsic limits of Capital. We've always insisted on the indissociable unity between accumulation of Capital and accumulation of misery, between the development of the productive forces and the concomitant catastrophe of society, between "the wealth of nations" and imperialist war.

Against the current of the various parties of order and in total antagonism to social democracy, in opposition to fatalism and to all the dominant illusions, we can only laugh at the proclamation of "a new world order" supposedly purged of its contradictions. We claim loudly -in spite of our isolation- that the coming catastrophes will be still more devastating and that all attempts today to curb the internal contradictions of Capital can only lead to the postponement and the exacerbation of their unavoidable explosion.

Once more, the validity of communist theory is being confirmed by current events: the political, social and economic catastrophe is worldwide. Everywhere the working class is being subjected to more misery, more unemployment, more war... The capitalist world is less and less capable of hiding its putrid reality.

We do not intend, in this article, to quote all the figures or statistics illustrating this catastrophe. Each one of us, all proletarians, live this social disaster every day in our flesh. We will stress only some essential aspects of the world situation so as to illustrate the depth of today's catastrophe. We will make clear the violence with which this mode of production is confronted with its own historical limits today. On the other hand, we will highlight the unavoidability of a catastrophe that is generalised to the whole of humanity, unless the latter manages to destroy all the social market and labour relations that are crushing it.

2. From the crash of the model of social capitalism to the ruin of the archetype of the United States as an economy to imitate !

These last years, we've witnessed the crash of the model of "socialist" capitalism, of "social" capitalism, of the "social project" of the "bourgeois left" (1). The Right finally triumphed and liberal capitalism could again take up its place as the sole worldwide model, venerated by all bourgeois factions.

The "war of all against all" has always been at the basis of this society. No reforms, no utopia, no attempts to "humanise" this society have ever been able to change this reality. But while in the past they tried to hide this reality, feeling shameful about it and talking at the same time about helping the poor, today they openly claim that such atrocities as "the poor getting poorer" are unavoidable. Never before has capitalism taken on the liberal discourse to such an extent. Never before in the history of this system have they asserted so openly that the growth of this society necessitates the misery of the masses, and that the famous economic development of society requires our sacrifice and the repression of all insubordination. The discourse and the recipes of the IMF -in times past considered to be the programme of the ultra-right- have become, over the last few years, the only conceivable economic politics. Even the "economic" model advocated by Pinochet (2) to get out of the crisis, has now become famous again and those bourgeois factions who do not accept it are soon edged out.

It has now become clear that reformism and humanism are just idle politicking. Capital doesn't care about those who've pretended to keep it under control; it has shown that it is the only boss who commands everything and that all those who've pretended to direct it, have been nothing else but its mere executors (3). It has become all too clear that in this society there is only one god to worship: PROFIT!

But while reality became more and more forthright and world capitalism sank into a generalised depression, the proletarian masses, anaesthetized by TV, video, papers and other brain-washers, did not see the reality of this crisis -as always, consciousness trailed behind. Capital could continue to pretend that the USA, Japan and Germany were still valid models of liberal market economic growth while in fact, everywhere, worldwide, capitalism entered into a generalised depression. The economic catastrophe of capitalism in the East was so violent and so fast that it remained possible to uphold the conception that the liberal market economy remained superior and was the only valid model free of all risks of crisis.

Neither the clarity nor the brutality of the discourse asserting that all development necessitates misery and sacrifices, could hinder the expansion of the United States as a "model" to strive for. But in the United States itself the catastrophe had reached such incredible proportions that it could no longer be hidden (4). The "model" was only intended to be sold abroad. The "model" was used for export only because in the United States itself it had irremediably crashed and could no longer remain credible in the eyes of millions of proletarians who had to face poverty and unemployment. In this country, the "model" had reached a state of putrefaction. The sacrifices that were called for for the sake of future development could no longer be justified since it had become impossible to hide that this development opposes itself to the immediate and historic interests of the human species. During a whole period of economic growth, misery increased (in relative terms, but also, in some aspects, in absolute terms) and all aspects of human life deteriorated: more homeless; more famine; less health care; massive drug addiction; increase in rapes, crimes and violence in general; generalised pollution; development of racism in all strata of society; militarisation of daily life...

But the United States remained a "model" for export, because over the last decades they were the motive force of world capital and represented the antithesis to the pretention (by now completely obsolete) embodied in the Soviet Union and its allies of checking and planifying the economy (it is in this way that the United States became the very symbol of "triumphant capitalism"). The imposition of the American "model" -in spite of blatant reality-is also due to the way this reality is being reflected by the media, and by the fact that whereas political managers are forced (by Capital itself) to produce some immediate results, the same is not true for technocrats and analysts who prepare the theories for the international media: they can afford to water down reality, to produce optimistic images to replace reality (that is their "raison d'être").

We would just like to draw attention to the fact that the "wellbeing" that politicians depict, the model of society that they are offering us today, is not some paradise, some utopia, but only an embellished image of the United States. What a prospect!

In the areas of the world where "anti-imperialism" against the United States was a powerful ideology for controlling the proletariat, the positive image of the United States was more powerful still. Not only was it pretended, in these countries, that misery in the US could not possibly be compared to misery elsewhere, since "the USA is a rich country", "a developed country" (with a GNP of such an amount of US$ per inhabitant!), but moreover, and in full agreement with the interests of the bourgeoisie of this country and of the whole world, the importance of the historic struggles of the proletariat in the United States was being tarnished or even completely negated. The myth of a "labour aristocracy" systematically allowed the overshadowing of the explosive character of the contradictions and the historic importance of the struggle of our class brothers against Capital and the State (5).

Today's worldwide economic depression that strikes more particularly the very heart of the command centre of the system -the productive space of the United States- makes this contradiction even more complete. The catastrophe of social and economic reality in the United States stands more and more deeply in contradiction with its pretention to be the only valid capitalist alternative.

Without doubt it is difficult to grasp the exact meaning of the following figures:

a black person living in New-York has less chance to reach the age of 65 than an inhabitant of Bangladesh;

the rate of infant mortality is higher in Washington than in Jamaica or in Chile;

in Los Angeles, 40.000 people sleep in the streets (1992).

It is probably difficult enough to understand the meaning of this misery as mere misery; it is even more difficult to grasp its subversive, revolutionary character.

It has also proved difficult to make it understood that before the struggles in Argentina (Cordobazo), before '68 in France or '69 in Italy, before even the important proletarian struggles in China (led astray by what is known as the "cultural revolution"), that the wave of proletarian struggles had basically started in North-America, in the South of the United States, in the North of Latin-America, in Santo Domingo, in Mexico,... MAINLY IN THE BLACK AND HISPANIC GHETTOES OF LOS ANGELES.

The revolt of our comrades of Los Angeles in May 1992 announces the agony of the myth of the United States as a "model" to imitate, and prepares the ground for today's struggles of the international proletariat. It shows not only that the USA does not constitute a valid "model", but also that this area is not safe from the wave of proletarian revolts that shake the world. All this expresses a qualitative step forward in the nature of our struggles and does away with the illusion that each time there should be some "special" reason that explains the "particular" origin of such or such a struggle.

Thanks to this revolt during which our comrades from LA attacked the State and its representatives, thanks to the strength with which they stood up against the world of property, the last illusions about the American "model", or about the supposed differences between the proletariat of this country and of the rest of the world, have fallen to pieces.

When in Poland or in Rumania revolts erupted, we were told that this was because of the dictatorship and of the bureaucratic tendencies that dominate these countries; when in Algeria, in Morocco or in South Africa the proletariat rose up and clashed violently with bourgeois power, they told us that this was because of the age-old backward situation of this historically "underdeveloped" continent; when proletarians in Venezuela and in Argentina attacked private property and the State, these struggles were faked up to look like mere looting caused by famine and supposedly peculiar to "Third World" countries; when in France and in Britain (in Vaux-en-Velin, and Trafalgar Square for instance) the same class anger expressed itself, they blamed marginals and immigrants... and today, when at the very centre of the capitalist model revolts erupt, and when these struggles spread from Los Angeles to the suburbs of Toronto, Washington and New York, then what else can the international bourgeoisie do than lie once more and claim that all this is only because of a problem "amongst blacks and hispanics"! But such an absurd story will undoubtedly be difficult to impose and it becomes obvious that even for the bourgeoisie the credibility of the American "model" starts getting into bad shape.

For the world bourgeoisie, a model of development remains attractive as long as it works. It can remain attractive even when proletarians are starving to death (and this is one of the historic conditions for all intensive growth of industry!) and when the main cities get filled up with unemployed and beggars. But the charm of such a model fades away as soon as proletarians start to rebel and challenge the established order.

This is why, when Bush was forced to bloodily repress the revolt in Los Angeles, the myth of the North American "model" disappeared as if by magic. All the big chiefs of the world industrial giant, all Presidents, Ministers... quickly announced their opposition to the North American "model" and declared that the revolt was due to the particular conditions in the USA... i.e. could not possibly occur in their own country!

It is always the same song: the proletariat supposedly never fights against capitalist misery, but always against abuses or "abnormal" developments of the system. This is how the "racist abuses that exist in the USA"... or still, "neoliberalism", or "Reaganomics", etc. where blamed for having caused the struggles that shook the USA in 1992.

These clumsy justifications serve the aim of hiding that the revolt of the proletariat in Los Angeles was directed against the enemies that oppress us, and therefore expresses the interests of all proletarians all over the world. They try to conceal that in the whole world their system is the same, that the struggle of proletarians in Los Angeles is our own, and that, while we fight against the bourgeoisie of "our" country, we stand on the same side of the barricades as our class comrades in Los Angeles.

"Hence the highest development of productive power together with the greatest expansion of existing wealth will coincide with depreciation of capital, degradation of the labourer, and a most straitened exhaustion of his vital powers. These contradictions of course, lead to explosions, cataclysms, crises, in which by momentaneous suspension of all labour and annihilation of a great portion of capital the latter is violently reduced to the point where it can go on fully employing its productive powers without committing suicide. Yet, these regularly recurring catastrophes lead to their repetition on a higher scale, and finally to its violent overthrow."

Marx - Grundrisse.
3. Even the positive poles of capitalism do not escape from catastrophe

In general, Capital puts forward its positive pole while rejecting its negative pole as not being its own (and generally explaining it by a "lack of capitalist development"!). Capital puts forward as being its own achievements: wealth, the development of productive forces, progress, peace, flourishing business, democracy... and rejects as being hostile to its own being everything which might bother this idyllic picture. The misery of always larger strata of proletarian masses is understood as a lack of integration of these masses into capitalist society, or still as a lack of development in the related areas. Open repression and State terror are depicted as the result of the actions of a particular "dictator", all irregularities supposedly are due to some "bad manager" or some corrupt government (6), racism (intrinsic to capitalist society!) supposedly is due to some particular "right-wing" bourgeois faction, and all capitalist misery, the ghettoes, favelas, shanty towns, pollution... are always being considered as temporary. And always Capital will put forward the need for more capitalist development, more progress as the sole medicine capable of curing these "abnormalities".

As always, revolutionary communism denounces these lies (7) and insists on the fact that war, famine, crisis, unemployment, racism... are not foreign to capitalist development, but are its authentic products!

What has changed today, with the vertiginous worldwide depression, is that Capital no longer has a positive pole to exhibit, that there are no more "model" countries to imitate.

Today (october 1992) in the United States, factories close down one after the other, misery is growing beyond all limits and social decomposition has reached a peak. This destroys the myth of an American economy being safe from crisis. But, on top of this, even such countries as Germany or Japan, which used to be considered -no longer than two years ago- as "models" of economic growth and of dynamism, are severely hit by the generalised depression.

For instance, the Tokyo stock market, supreme representative of "Japanese dynamism" and former "model" for investors of the whole world, hasn't stopped collapsing since 1989: its index that had reached 38,600 in 1989, fell back to 14,300 in the summer of 1992. This represents a drop of 63%. And as far as the other models of development are concerned, the situation is hardly any more brilliant. As a matter of fact, the whole of Western Europe is sinking into a generalised depression: the system of monetary parity, generally considered to be the most solid of all, has broken down. London is announcing closures and bankruptcies every day, the Italian economy is sinking into chaos and the other countries are trying to resist as well as can be expected. Whole sectors of the economy, the most representative corporations of capitalist progress and dynamism, go bankrupt or have to announce a fall in profits, redundancies and so on.

On the international level, the case of Pan American for sure is the most typical one because it is the main calling card of the US. But other companies in the US as well, such as TWA, Eastern or Braniff are in the same situation. On the other continents, the situation is hardly any better: Lufthansa, Air France, SAS, Sabena... are announcing ever greater losses. Aeroflot, the company that has the biggest air fleet and the highest number of flying hours in the whole world, is also facing increasing difficulties.

The same goes for the car industry. General Motors, the historic symbol of social and democratic North American capitalism (8), announces incredible losses and drastic cuts in jobs. Ford and Chrysler the same. Other sectors of industry as well are faced with identical problems. AT&T, the biggest communications company of the whole world, had to admit several thousands of million $US of losses in 1991. IBM is continuously planning new restructurations and new strategies and anticipates massive lay-offs. NCR and Digital Equipment are also sacking workers massively.

So it is hardly surprising that faced with such "models" of dynamism, development, democracy, or economic efficiency... that the growth of the world GNP for the first time is nearly zero, and that all estimations confirm the provision (for the first time ever) for a reduction in international trade in volume (about 3%) and in value (about 1.5%).

4. The bourgeois solutions to the generalised depression

The bourgeoisie can no longer hide the generalised depression of the worldwide capitalist economy. That's why they've now started to tell us another story, asserting that the end of the crisis is near, that the economic takeoff will be there tomorrow, and that next year at the latest the "recession" will be over. But no sooner have they formulated these optimistic forecasts, when already they change them and start reconsidering the delays in the prospects they've announced. This once more illustrates that it is Capital that determines the planifications and perspectives, not the other way round (9).

In as little time as it took for the world bourgeoisie to rally round the general apology of liberalism, the various managers and economists have already started to call for State intervention again. The most determined defenders of the "invisible hand" (i.e. of the automatic regulation of economic life without State intervention) started to call for such or such measures in order to increase credit to companies, to increase effective demand, and they criticise the management by former administrations blamed for provoking chaos.

This is no surprise to us. The myth of the invisible hand perfectly regulating the economy, is a myth that during a period of economic growth is always being supported by the dominant ideology. But as soon as capitalism gets into a new cycle of crisis, this myth collapses. Capitalist cycles take place according to a scheme that hardly ever varies. During periods of depression, all bourgeois factions fight against the tendency of the rate of profit to fall. They feel in their bones that the markets get narrower and narrower, and that they no longer expand at a pace required by capitalist accumulation (10). These bourgeois factions then call for political interventions to protect the process of accumulation from devalorisation; either by counter-balancing as much as possible the tendency of the rate of profit to fall and this generally results in an increase in the rate of exploitation; or by trying artificially to enlarge the markets through the extension of credit payments, by public expenditures, by the militarisation of social life... Today is only a repetition of the past.

However, if the general scheme hardly ever varies, nevertheless the situation changes because each crisis is always more acute than the previous one. The contradictions that in the past were hidden and postponed, now explode even more violently. The economic politics that have been used in the past in order to artificially increase effective demand transform themselves into additional problems. In all sectors Capital is being confronted with its historic limits.

We can take the example of companies that manage to remain on an even keel because they benefit from different forms of protection (subsidies, commercial protection, free credit), in complete contradiction however with the law of value that condemns them to close down and sack their work force. With each economic cycle, such companies move further away from a "natural" profitability (i.e. a profitability obtained through the famous "invisible hand"). Each year it takes more subsidies, more cheap credit, more measures of economic protection... to keep them on an even keel. These procedures -that result in increasing public deficit in order to finance companies that are no longer economically viable- become more and more perilous and they stand in contradiction with other sectors of Capital who do not accept that the State allocates their surplus value with the aim of helping obsolete companies to survive that have become completely devalorised. For Capital, the dilemma becomes more acute: on the one hand the "natural" necessity to close down factories, producing millions more unemployed - and this in turn will reduce effective demand even more, and is likely to provoke inevitable social explosions; on the other hand, the "choice" to postpone this economic truth again, knowing perfectly well that generalised bankruptcy will become all the more violent. This kind of problematics will generalise itself and involve an always growing number of countries or blocs of countries until the situation will become unbearable and the bourgeois faction in charge of government gets swept away by another one that will start again to hold up the flag of liberalism, but will also inevitably soon have to confront the moment of truth! This was the case, a few decades ago, in South America with industrial populism. This is what has been going on in the "East" countries such as the Soviet Union, Romania, Poland, Czechoslovakia, Hungary... (11) over the last few years. And this is also the tendency today in countries like the United States or Britain, for instance.

The artificial increase of demand on the basis of private and public credit, of public expenditure, or of "welfare politics", has not only allowed capitalism to continue to function, but also to get out of situations of economic depression and to enter, provisionally, into a phase of expansion. The United States in particular, is a good example of national Capital having been propelled beyond its limits on the basis of artificial creation of solvent demand. In this country, even more than in all others, public expenditure has reached astronomic levels (especially in the field of military industry). In this country, they've acted as if there was no limit to the granting of credit to private industry and they've multiplied, at rates unheard of before, all possible credits to the customer without taking into account his real earnings. This policy could be used in the United States more than anywhere else since this country has the possibility to issue -to an apparently unlimited extend- the unit of value, not only as an expansive internal policy, but also because of the role played by the $US on the world market in general (as a matter of fact, in spite of the failure of the Bretton Woods agreements, the United States continues to function as the central bank of the worldwide capitalist system) as well as on the domestic market of numerous countries. This has allowed for an increase in demand without -in spite of this- immediately creating a generalised devalorisation of the unit of value (as happens in other countries when the local State issues illconsidered amounts of money). Indeed, international trade today absorbs an incalculable amount of these units of value. In the beginning of the Seventies, when worldwide capitalism was confronting the objective limits of expansion following generalised destruction caused by war, these policies were what allowed the successive economic expansions of the post-war period to be financed (12). Due to these policies, the national economy of the United States could impose itself as the uncontested motor of worldwide capitalism during this period.

We should not forget that if Reaganite (or Thatcherite) liberalism has pretended to be anti-interventionist to the point of flirting with fashionable anarcho-capitalist ideologies (13), this is because it clearly advocated the abandonment of all social illusions within the capitalist system. Its politics of no taxes on capital stood in full agreement with the cuts it operated in the whole of the "social budget". The consequences of such policies resulted in a short-lived recomposition of the main driving force of the economy, the rate of profit. At the same time a relative fall of salaries occurred, i.e. a net increase of the rate of exploitation. However, they did not have the courage to take these politics to their ultimate consequences nor to abandon at the same time the whole of the credit allocation facilities (14) because this would have caused an even worse and more abrupt catastrophe. On the contrary, they tried to combine the generalised increase in the rate of exploitation (due to a reduction of the overall income of the work force - including unemployment allocations, welfare and so on) as well as the decrease in taxes (15) with the widespread expansion of State sponsored credit. This has resulted in the hugest fiscal deficit ever accumulated in the history of world capitalism. While the official discourse was about liberalism and promised to reduce or even completely eliminate the fiscal deficit, it remained obvious that capitalist reality demanded the preservation of an economy based on public expenditure (particularly the war economy) and the application of Keynesian economic politics.

But since, in spite of this, no economic growth ensued, these economic politics failed and illusions vanished. At the same time the international bourgeois class never stopped predicting the coming of a new golden age, the coming of a new economic expansion that would put an end to today's generalised depression. Even today still, in spite of the obvious worsening of the world economic situation and mainly in the biggest examples of triumphant national economies (United States, Japan, Germany, Britain, Italy...), not one day passes by without having some politician, some economist or some journalist telling us that soon we'll be delivered from the economic crisis and get back to the golden age of capitalist prosperity.

But beyond all these nice words and promises, the procedure remains the same: lowering of the interest rates (basically through the lowering of the discount rate of the Central Banks in order to favour credit and investment) and increase of public expenditures. This can only be achieved by increasing always more public and private debt, internal and external.

This is exactly what has been done up till now and this is the source of today's generalised chaos. All speeches, all promises of expansionist economic politics, only serve the purpose of injecting some more morphine into moribund capitalism.

In 1985, in an article against the various myths concerning the external debt of "Latin American countries", we already stressed the fact that this corresponded not to a particular phenomenon but to the generalised and insoluble situation of worldwide capitalism.

"Faced with the end of the phase of expansion that followed the second world war (during the whole history of capitalism, wars, reconstruction periods, routed proletarians... have always been the inevitable antecedents that have made an ulterior "healthy" development possible), worldwide capitalism has only succeeded in postponing catastrophic depressions, while creating huge amounts of fictitious capital. The levels that were reached in this field, not only in absolute terms, but also in relative terms compared to world production, are far ahead of what ever existed before. Even more so, the most incredible anarchy and the absence of widespread control in the relationship between these two magnitudes (between fictitious capital and the production of goods) prevails on the international scale. For the future phases of depression, this preludes that such a situation will become multiplied (or expressed differently, will be raised to a power with unpredictable consequences) by the massive and brutal destruction of fictitious capital, blowing up all contradictions of this social system at a level unheard of until now. The different stages of easy and widespread credit during the post-war period, the massive debt of all governments, as well as the unrestrained creation of units of value that in fact do not represent any value, correspond to always shorter and weaker takeoffs of the world economy. These kind of drugs administered to an exhausted body have at each cycle produced a stimulating effect. But it made the system of enlarged international reproduction of Capital function as if it was a child... until the effect wears out and a higher dose of drugs becomes necessary. Then after a while even higher doses of drugs produce no more effect and finally the remedy becomes worse than the illness... and in the end, Capital appears as it really is, an enuretic and rotten morphine addicted corpse.

For the proletariat, the only real perspective for the human species, it is fundamental to expose this worldwide diabolical dynamic: against all dominating myths, it is of vital importance to reveal that debt (or rather today's generalised and insoluble debt) is nothing else but one of the most remarkable manifestations of the anarchy and of the historical end of a social system that engulfs all of mankind." (16)

So the increase in expenditure and of public debt have been the historical remedies that have allowed, in each country and for a given period, a certain growth beyond the real limits of production. These therapies have been used each time again on the world level, and we can assert that world production and trade over the last decays could only function "adequately" because of such policies... but this is precisely what has brought about the present situation of default in payment. And the worst for world capital is that even today's rhythm of growth, nearly zero, can only be maintained through an increase in international debt, i.e. by the implementation of the very economic policies that have become totally unbearable for Capital today.

A little bit more than ten years ago, the financial catastrophe was so bad that most Latin American countries, as well as many countries from other continents, threatened to stop debt repayment. Straight away, the granting of credit was cut down for a large number of them. The same happened a bit later in various African States and in several East European countries. Then for a while the world bourgeoisie cherished the illusion that growth would continue anyway, "in spite of everything", thanks to the socalled "new effective demand" that was supposed to come from the East (17). But soon these new illusions vanished as well, and once again they had to apply the policies of easy credit so as to create solvent buyers... while only necessities existed... but these policies also ran out after a few years. Simultaneously, in other parts of the world, the same limits as those that we know today were reached: the US is a very clear example of this: if we add the debts of consumers, of companies and of the central government of this country, we reach an astronomical number superior to $US10000 billion, which equals 2 years of national production in this country!

In spite of all these efforts, in spite of all these therapies to revitalize Capital, in spite of the existence of such artificial buyers, in spite of the mass of investments financed through credit, in spite of the extent of fictitious demand created by the Keynesian multiplier (18), today all these vain promises about the "end of recession" fall apart one after the other.

But could there possibly be any other unexplored possibilities to allow Capital to overcome today's generalised depression? Could there be any other bourgeois politics than those that have been implemented until now? The answer is no. Categorically no!!! (19)

5. Exacerbation of class war and of imperialist war

But worldwide Capital does not reason as worldwide Capital and is not conscious about the non-existence of a political economy that would allow itself to continue to grow beyond all limits. Capital considers these limits to be temporary, and it considers itself to be the highest and final stage of development in history. Of course it envisages changes, but it does not envisage its fall. Moreover, it does not have any capacity of worldwide, centralised decision-making; quite to the contrary, it is essentially ungovernable.

Decisions are not taken either by worldwide Capital, nor by Capital in general, but by each particular Capital, by each particle of Capital. It is because of this reason, in such situations without any capitalist general solution, as is the case today, that the decomposition of Capital into particles accelerates, that competition grows stronger still and that the generalised "run for your life" (the true rule of this society) materializes when each has to walk on the head of his neighbour in order to survive.

This "neighbour" of course is first of all the proletariat, its "own" proletariat and the capitalist will not skimp on any efforts in order to increase the rate of exploitation. But the "neighbour" is also personified by the bourgeois competitor, and each capitalist is ready to destroy this neighbour by waging commercial war until its ultimate consequences: military war.

So what matters is not what the capitalist wants or does not want, whether he's "left" or "right", whether he's the director of a multinational or of the Cuban State. What matters is what each capitalist is forced to do, in accordance with his function as a manager. As Marx would have said, he's nothing else but the creature of value valorising itself, of the social relation reproducing itself (20) and in this sense he's not responsible for what he's doing since he's obliged to act that way by Capital. We feel that this assertion is essential to fight against all illusions about the capacities of such or such a capitalist, of such or such a manager to act differently from the way Capital forces him to act (21).

This is the general explanation of what is happening at present and of what we're living daily: always stronger restrictions, increasing misery, more unemployment... it is the explanation of the always more murderous war against the proletariat. And it is also the explanation of the unceasing increase in local wars and of the intensification of inter-bourgeois wars. These wars materialize through the marked increase in protectionism, the rupture of commercial agreements, through the difficulty of bringing trade agreements to a longlasting successful conclusion, as we can witness with the GATT negotiations (22); also through the rupture of the old alliances (and we shouldn't forget that countries and unions of countries are nothing else but inter-bourgeois alliances trying to confront other capitalist factions!), through the rupture of commercial and military blocs, through the constitution of new imperialist constellations...

However, it is clear that the austerity measures -the lowering of real wages, the increase in intensity and hours of labour in order to reach the same level of production with less workers (i.e. while paying less in wages), all the measures recommended by generalised liberalism and which result in a net increase in the rate of exploitation and of profitability for particular capitalists- including when this concerns an entire country (and when the bourgeois of that country benefit from this), all these measures are prejudicial to capital in general since they reduce the worldwide effective demand. This for instance is what was practised by the Pinochet government. The violent lowering of real wages (and even more so of relative wages) and the increase in the rate of exploitation and of profit, have attracted capitals from the whole world and allowed for an acceleration in national growth. But, logically, the excess of surplus-value that was produced in this way could not be reinvested in the same country and necessarily had to be introduced on to the market of other national capitals, in order to realize itself; this shows clearly that this kind of policy is a short run policy or -if you prefer- that it will necessarily come into contradiction with the interests of proletarians but also with those of other national capitals, and that it cannot possibly bring about a solution on the level of global Capital.

The other so-called antagonistic policy by which nation States try to manage the contradiction between particular and global capital consists in increasing fictitious demand. This does not bring about a global solution either and will also lead to war. In the face of the tendency for each particular capital to increase beyond all limits the rate of exploitation and of profit, nation States always represent a higher level of globality for Capital (23). The managers of the State and their ideologists, economists and sociologists as well as being apologetic about existing social relations, all try to abstract themselves from immediate reality; they'll advocate an economic policy that imposes discipline on each particular capital not only on the basis of governmental efforts (public expenditure, budget deficit...) but also through the establishment of a series of rules for each particular capital (minimum wage, maximum working hours...). This allows the State to represent itself more easily as being "beneficial for the whole of society" (24). All populist regimes, from Hitler to Fidel Castro and from Roosevelt to Stalin, have tried to implement such policies but its most thorough theorization is Keynesianism. This policy can also only be a short term policy, since in the long run all contradictions are postponed, accumulated, exacerbated(25). It can only be a national policy and not a worldwide one since it stands in contradiction with the international competitiveness of the companies of the countries that apply such a policy and because sooner or later it will lead to the accumulation of deficits of the balance of payments and of the balance of trade as well as reinforcing protectionism. It will lead to the confirmation of its weakness in the commercial war and this unavoidably will raise the need to pursue this policy in the military field. It is clear also that people cannot just be hired to dig holes that other people will fill in -what dynamises the national economy most is a war economy! And since each national capital considers those who stand in competition with itself, who take "its" raw materials, who sell cheaper, who attack its position on the markets... to be its enemies, the drive towards war will become always more imperious. So this policy also can only lead towards imperialist war, and its most consistent theoreticians -like Keynes himself- never really felt emmbarrassed to admit that since war is necessary to save capitalism, one had to prepare for it.

All this leads to an increase in the number of local wars, to the decomposition of old alliances and nations, to the constitution of new fronts and imperialist constellations and to the generalisation of war to the whole planet. Such is the capitalist perspective.

And without mentioning the whole series of accidents and daily catastrophes that Capital imposes on the worldwide population, such as nuclear accidents or the multiplication of areas where children are born with various physical defects because of pollution and contamination that their parents have been exposed to (26). And without taking into account that what Capital is proposing as a model (life in a modern city for instance) could not possibly be generalised to the whole of humanity because this simply would jeopardize the survival of the planet earth.

"You are being one-sided" we are told. No, we are not onesided, but it is Capital that is one-sided, its own progress leads to crisis, to destruction and to war. This society is a cannibalistic society, the development of Capital feeds itself with human beings, it destroys them, kills them, swallows them. And on the level of the whole planet the present situation stands as a blatant confirmation of our conception, a categorical confirmation of communist theory.

6. War is everywhere

"New World Order", "the end of Communism", "an era of peace and prosperity", "the end of history"... they would like to make us believe that humanity has reached a level beyond which it can not develop any further! One of their ideologists even declared that:

"liberal democracy can be the final point of the ideological evolution of humanity and the final form of all human government; as such it can be the final point of history." (27)

Worldwide capitalist reality everyday contradicts the speeches by the apologists of the system: never before have there been so many territories at war, so many military and para-military clashes; never before has there been such a mass of corpses caused by capitalist war (and peace!); never before in human history has militarism taken such an important place in life and never before has the production of arms and their commercialisation been so colossal; never before -in relative and absolute terms- have such large numbers of human beings been confronted with the daily reality of war (and/or with the possibility of the launching of war at almost any time) and with all the consequences that go with it.

Today, war is everywhere; not a single continent escapes from it. War is going on in former Yugoslavia, in former USSR, in Somalia, in Turkey, in Iraq, Burma, in the Philippines, in Lebanon, Chad, in CentralAmerica... without mentioning those other imperialist wars, like the "drug war" in Bolivia, in Peru, in Colombia, in Brazil... that also directly attack millions of proletarians.

Experts in political science have listed 125 "centres of ethnic conflict" in the former Russian bloc, of which 25 have already degenerated into open armed clashes. Nearly every day a new armed confrontation takes place; nearly every day a new "nation calling for self-determination" rises up. Each caricature of a "republic" in the former USSR has its own "home-made" contradiction because such or such of its minorities threatens to promulgate its independence. Almost daily new curfews are being imposed in such or such area and more central armies are being called in to put down more local ones. One day, such or such an imperialist power -in full agreement with its expansionist interests- recognises the right to self-determination for such and such a new "State" and the next day -still in agreement with its expansionist interests- the same power refuses the same right to some other State. In this game of profits and numbers, of speculation and stock-exchange, of alliances and ruptures (28), thousands of corpses of men, women and children, thousands of wounded and disabled people... just pile up while the rest of the population in these regions survives precariously in the midst of ruins, famine and a general shortage of everything. No need to go to Somalia or Ethiopia (where the situation is getting more dramatic everyday) to attest that the population is facing starvation. In the former USSR, and in spite of all Western "aid" in order to maintain bourgeois law and order, famine is threatening and a rate of 90% of the population living in poverty is officially admitted.

It really is no longer possible to hide the destructive and cannibalistic character of this mode of production!!!

7. Catastrophe and Revolution

The catastrophe of the capitalist world is subjecting the proletariat to a hellish situation of death, famine, misery, permanent insecurity, war... And this situation can only get worse.

Everywhere, Capital is facing its own limits and this opposes it irremediably to the human species and forces the latter to destroy Capital if it does not want itself to be destroyed.

Economic growth zero; economic policies to bring the crisis to an end that have all failed; war, its generalisation and the historical opposition to humanity that is the only outcome of all capitalist efforts; and even more so the unique result of the economic growth of Capital can only be a generalised worsening catastrophe.

If today all capitalist models collapse, it's because their extension is no longer possible; because if we hypothetically project today's economic growth into the future we can see that this would lead to the generalised destruction of even the most fundamental aspects of human life; because all life on this whole planet would simply die if the model of the United States were to be generalised everywhere; because the planet and humanity could not possibly survive if New York (and other big cities) instead of having 20 million inhabitants, would have 50 million! (29)

The destruction of the ozone layer, generalised pollution of the atmosphere and of water, global warming, desertification, destruction of forests... and all other disastrous consequences for the human species are only the isolated aspects of a colossal planetary catastrophe.

Everywhere, capitalism has reached the historical limit of its possibilities of existence, and the great tragedy for the human species is that Capital is carrying on at our expense because we are not capable of destroying it.

This is the big problem for humanity: the catastrophe, as we wrote at the beginning of this article, is not for the future but very much of the living, dreadful, present.

In this sense, the problem of revolution is not the problem of such or such "party", of such or such sect, of such or such social group, but it is the problem of the whole proletariat, of humanity as a whole.

In the face of the barbarism of the capitalist world, in the face of the exacerbation of crisis and war, in the face of always increasing attacks on its conditions of living and struggle, the proletariat has always revolted and we do not doubt that in the near future it will rise up again even stronger.

We can't pretend that over the last few years there haven't been any proletarian struggles. As a matter of fact, there have been many. In certain cases, like in Iraq, Burma, Algeria, Venezuela, Los Angeles... these struggles were very radical and hit at the very centres of power of capital and its State, without allowing themselves to be controlled by the unions or by any other bourgeois party of law and order. But today's main problem is that these strikes, revolts, demos... do not have any continuity, do not have any direction, do not have any international links between them.

We can't pretend that there have been no major explosions of proletarian outrage, and we've welcomed them. But we have to admit that they've lacked organisation and that for this reason, in many cases, they could easily be defeated and this allowed the State to step up its terror again.

We can't say that proletarians during these revolts didn't recognise their interests, since -for instance- they have opposed imperialist war, they've deserted, disobeyed, killed the officers that tried to send them to the battlefields, executed hundreds of policemen and other capitalist lackeys, as in Iraq. But due to a lack of structures and international and internationalist directives, such revolts have been isolated and contained by the nationalist bourgeois forces and this has meant a defeat of the internationalist militants.

We can't say either that these struggling proletarians do not know who they're attacking since, in general, through these revolts, they attack private property and its defenders and they seize whatever they need. The big problem is that a few days later everything gets "back to normal", to the sad daily struggle for survival where everybody tries to get by on their own and Capital dominates again.

We can't say that they have not confronted the State's servants, the policemen, clerics and other religious functionaries, leaders from left and right, trade unionists and journalists... since it is against these people that proletarian rage has been directed in the first place. But we have to admit that a majority of these State lackeys still sleep soundly in their beds while many of our comrades die on the battlefields or are in prison.

There exists an enormous disproportion between, on the one hand, the catastrophe of this society and the potential for explosion of the proletariat and on the other hand the lack of basic structures of our class, such structures that would lead us not to the repetition of 10, 100, 1000 revolts... but to an international social revolution.

We lack workers' associationism, international structures for contact, organisations, directives, a class consciousness of our objectives, capacities to coordinate, to decide in relation to the interests of the whole movement, to transform common international interests into converging actions that coincide in time... In short, more than ever we're in need of structuring the real community of struggle, constituting it as an organised force, as an internationalist communist Party.

Capitalism itself does not leave any other choice to the proletariat, to humanity.

Let's act in a conscious, organised

and determined way towards this end !


1. We've used inverted commas here to designate the "bourgeois left", because, although this term is being commonly used and although we do not know any other term to express this concept, from a revolutionary point of view the distinction between the left and right of the bourgeois class is not a real distinction. Not only must we stress that there is not the slightest essential difference between the social project of "left" and "right" as far as the defence of bourgeois order is concerned (and therefore we also put the term "social project" between inverted commas) but moreover, there are not any specific characteristics that would allow us to distinguish the economic politics of the "left" from those of the "right". This explains the coincidence between the kind of methods of organisation used by the model of "socialist" capitalism and the ones applied and promoted by such "leftists" as Hitler or Mussolini. Beyond certain oppositions as far as their talk is concerned, it is obvious that there exists a full identity of their class interests, but also of their economic project (for instance, protectionism) which allows us to reject categorically all supposed distinctions between these two capitalist factions. For example, if historically we can make a valuable distinction between the various agrarian, banking or industrial bourgeois factions, since they each have clear factional interests and corresponding economic politics, nothing similar can be done as far as "Left" or "Right" are concerned.

2. Pinochet's Christian Democrat successors talk shamefully of the "economic" model and, all the while pursuing its politics, claim that they are only applying it to the "economy", that is not in the "social" or "political" sense. As if it wasn't the economy which had obliged Pinochet to apply Pinochetism on the political and social plains: poverty and open state terrorism.

3. The most spectacular example of a historical attempt to develop and check Capital, is given by the Bolsheviks, filled with their social democratic ideology, starting in 1917. The failure was devastating -and could not have been any different- and Capital again became the only real social subject, transforming the Bolshevik party and its leaders into mere puppets.

4. Cf. "Quelques records du modèle économique mondial: USA" in Communisme No.36 (June 1992).

5. In some countries, like Iran, the State does not hesitate to put forward in its propaganda the "miserable situation of the poor" in the USA. They try to use the contradictions in the USA (between wealth and poverty, for instance) to depict this country as "a satan" and try to make proletarians in Iran reject the "corrupt western way of life". Their aim is to rally the proletariat behind their own ideological model and ("Islamic") values. This was one of the ways that the State in Iran used to defeat the very radical attack by the revolutionary proletariat during the 1979 uprisings against capitalist misery and its defenders (for instance through the promotion of such "radical" slogans as "Neither East nor West").

6. Corruption is not an "irregularity", it is the normal functioning of the ruling social system. In the same way, the existence of such or such a "mafia" is in reality nothing more than one of the expressions of the bourgeois State or, to be more precise, the blanket with which it covers itself in order to exonerate itself. The accusation enables one fraction to whitewash itself (of the things that they all do) while throwing the blame onto a rival fraction. At the same time this allows them to present the State as a neutral apparatus manipulated by bad administrators.

7. It is clear that most of the time those who support such lies and illusions, are themselves taken in by them and believe what they are saying. But nevertheless, these lies remain nothing but lies and in the historic war that the bourgeoisie is waging against the proletariat, they are manoeuvres to disorient and disorganise our class.

8. The reader should remind themselves that this company has always been presented as ideal not with respect to its size and economic clout (superior to that of some countries) but also because the workers have the opportunity to become shareholders. General Motors actually has the greatest number of workers who have become legal owners of their company in the world (the figure amounts to several hundred thousand). Of course this is part of and reinforces the myth legal ownership can never assure economic disposal of the means of production, that is to say their true ownership.

9. The illusion of controlling and planifying capitalist development is a permanent feature of all bourgeois factions, including the liberals. But Capital -a monster without head and that nobody can control- doesn't care about this and laughs at all economists and planners. This confirms the theory of our historic party which asserts that it is anarchy that rules the capitalist world.

10. The lack of markets and the fall of the rate of profit are of course nothing else, from our point of view, but the manifestations as they are being experienced -more or less violently- by capitalists (directly in their wallets!) and by the whole of bourgeois society -manifestations of the immanent contradiction of Capital. Bourgeois society, that is nothing else but the process of value valorising itself, can only concretise such valorisation by provoking always more violent, more generalised and more devastating devalorisations.

11. This explains why the Gross Product of entire countries not only stagnates, but even decreases. Estimates forecast a fall of 18% of the industrial production of the former Soviet Union, and of an average 9.7% for the other East European countries!

12. The growth of the Gross Domestic Product of Japan and the main Western European countries during the post-war period, has shrunk from 5.6% for the period from 1950 to 1973, to 2.1% for the years that followed; in the United States it shrunk from 3.7% to 2.3% during the same period. We can assert that from 1973 onwards -on the world level- the growth of the GDP has been maintained thanks to this policy of credit expansion, in complete disproportion with real production.

13. These capitalist ideologies oppose themselves to all State intervention and pretend to be anti-State. They pretend to substitute private companies for the necessary capitalist bureaucracy, including in the field of policing. In spite of today's acknowledged success of private police forces and employers' militia in numerous countries and sectors -we should not forget that this has always existed- it is clear that capitalism will never be able to avoid centralising itself as a State.

14. In a more general way, we can assert that liberalism and protectionism are always relative. It is only normal that the champions of liberalism did not go as far as interfering with other more structural protections of the American or British productive space, such as the generalised protection of the agricultural sector.

15. Properly speaking, one cannot say that a reduction in taxes, as such, provokes an increase in the rate of exploitation. Whether it be the State or private bourgeois factions that appropriate surplus-value, from our point of view the result is the same and we qualify this as a simple transfer of value. Nevertheless, because of this for each particular capitalist the ratio increases between the amount of surplusvalue that he gets and the salaries that he has to pay (the particular rate of exploitation or of surplus-value), and therefore the ratio between this surplus-value and the whole of capital that this particular capitalist has invested. It is this reality that allows us to formulate things in this way and to consider that such measures increase the rate of exploitation and of profit (for each particular capital). On the other hand, it is precisely to obtain this result that these politics are being adopted. The aim is not to increase the global social rate of exploitation, but rather the private rate of exploitation of each capitalist. This is how they try to stimulate investment and the accumulation of productive capital.

16. from "La cuestion de la deuda: basta de versos" ["About debt: enough bullshit!"] in Comunismo No.19, June 1985.

17. Of course this was a purely ideological illusion based on the myth that the system that was collapsing in the East was a social system that was different from the one in the West! This illusion had no real economic basis to it: since the "buyers" did not have anything to pay with, so through what kind of magic could "effective demand" possibly increase! The closures of companies in the East did not even allow for Western companies to take up similar positions to the same extent, since the real income of the population had fallen precisely because of these closures and the unemployment that followed.

18. For instance, when they issue a government bond corresponding to $US1000, or when they issue $1000 in banknotes, and when with this paper fiction they finance civil engineering, then, according to Keynes (who was one of the most distinguished bourgeois economists of all time), not only will global production grow because of these civil engineering works, but also and even more so, because of what the workers will be able to buy with the wages they'll receive in return for their labour. The multiplier is the rate of increase in production compared to the initial investment. As we can see, the capacity to develop this fiction so that it could turn into reality, finds its limits, as all fiction does, in the development of the contradictions of reality.

19. A war of generalised destruction remains the only capitalist solution in this situation. But in relation to the analysis that we're developing at this stage, it would not be right to introduce this notion here as if it were just another plain economic policy of Capital; this would mean to impute Capital with a capacity for decision-making that it does not really have.

20. "But here individuals are dealt with in so far as they are the personifications of economic categories, embodiments of particular class-relations and class-interests. My standpoint, from which the evolution of the economic formation of society is viewed as a process of natural history, can less than any other make the individual responsible for relations whose creature he socially remains, however much he may subjectively raise himself above them."
Karl Marx, Capital,
Preface to the first german edition.

21. If a manager really refused to bow to the dictatorship of Capital, he would soon disappear as a capitalist and Capital would coopt someone else to replace him (as happens frequently).

22. Structures like GATT (General Agreement on Tariffs and Trade) formalise the existing balance of forces between various capitals, companies, capitalist States, blocs of countries... During periods of expansion such structures work pretty well, but during periods like the present one such agreements are generally called into question. And, as we could see with the famous failure of the "Uruguay Round", such conferences are never-ending parodies that spectacularly reveal the impossibility of the various bourgeois factions accepting the settlements that they agreed upon yesterday, because today it would imply their own suicide. The repetition of such failures only preludes the passage of commercial war to military war.

23. It would not be right to state here, while analysing inter-capitalist contradictions, that the State represents Capital in general. This of course is true, in the face of the proletariat, in the face of its revolutionary project; but not on the level of our analysis here when we look at how each bourgeois State also stands in contradiction with other national States and how -including within each Statethere exists the tendency for its decomposition into its constituent parts, a tendency towards its own negation and towards its restructuring into the form of other -inferior"national units". A good example of this is what happened in former Yugoslavia!

24. It is clear that such rules are a response to proletarian struggles and that, just like all other legal formalisations, they tend to "grant" whatever is coherent with the needs of capitalist valorisation seeking in this way the renunciation by the proletariat of autonomous struggle.

25. Keynes himself didn't mind admitting that "in the long run, we're all dead!"

26. In various cities of the former USSR or Romania, for example, more than 85% of the children whose parents have had to handle nuclear missiles during their military service are born with serious genetic defects!

27. Francis Fukuyama, former advisor to the US State Department, in his book "The end of history and the last man."

28. This whole situation clearly illustrates -once again- that bourgeois politics directed towards (against!) the proletariat and called "the struggle for self-determination", "antiimperialist national liberation", "the struggle for independence"... is a particularly vicious politics.

29. The unilateral generalisation of the positive poles of Capital is of course an absurdity in itself, because the essence of capitalist development precisely contains this polarity in which the "poles" develop themselves while imposing "under-development" everywhere else. If we take these examples that make up the supreme ideal that all the ideologists of the regime long for (while pretending that proletarians share such desires) it is only to illustrate, even on such an extreme level, the full incompatibility between the ideal of Capital and the needs of the human species.

"The huge problems facing humanity today - exploitation, misery, war, famine, alienated and estranged labour, mass unemployment,... - are inherent to, and the necessary result of, capitalist progress and barbarity. They can only be properly confronted (and understood) if, instead of being seen in isolation, they are tackled in the context of their driving force - the capitalist system, the capitalist system history's last class society, a transitory society which is at the same time an integral part of an historical arch spanning from primitive communities to communism, and an integral part of the process of creating the material conditions for the institution of worldwide communist society. Communism will not mean the end of the human history. Communism, the formation of a universal community of human beings will, on the contrary, signal the genesis of truly human history, resulting from the abolition of private property, social classes, the State, etc..."

Theses of programmatical orientation of the ICG, thesis No.1