Capitalism and Its Alternatives

170 Pages·2014·1.27 MB·English

by  Rogers

About the author
Chris Rogers is Leverhulme Early Career Fellow at the University of York. His
first book, The IMF and European Economies: Crisis and Conditionality, was
published in 2012. Chris is currently working on a research project on the
political economy of mutual organization.
CAPITALISM AND ITS
ALTERNATIVES
Chris Rogers
Zed Books
LONDON
Capitalism and Its Alternatives was first published in 2014 by Zed Books Ltd, 7
Cynthia Street, London N1 9JF, UK
This ebook edition was first published in 2014
www.zedbooks.co.uk
Copyright © Chris Rogers 2014
The right of Chris Rogers to be identified as the author of this work has been
asserted by him in accordance with the Copyright, Designs and Patents Act,
1988
Set in Monotype Plantin and FFKievit by Ewan Smith, London Index:
[email protected]
Cover designed by Steven Marsden
All rights reserved. No part of this publication may be reproduced, stored in a
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mechanical, photocopying or otherwise, without the prior permission of Zed
Books Ltd.
A catalogue record for this book is available from the British Library Library of
Congress Cataloging in Publication Data available ISBN 978-1-78032-739-6
CONTENTS
Acknowledgements
INTRODUCTION: CAPITALISM AND ITS ALTERNATIVES
1Â Â FOUR FACES OF CAPITALISM
2Â Â CAPITALISM AND ITS CRISES
3Â Â ALTERNATIVES TO CAPITALISM
4Â Â ANTI-CAPITALISM
CONCLUSIONS: FROM HERE TO THERE?
References
Index
ACKNOWLEDGEMENTS
This book was written during a Leverhulme Early Career Fellowship (ECF-
2011-003) and I am grateful to the Leverhulme Trust for the funding that
allowed me to spend time thinking through the issues raised in the book. I would
like to thank Ken Barlow at Zed Books for his help in developing the project in
its early stages, as well as Werner Bonefeld, Charith Cabraal, Chris Clarke, Catia
Gregoratti, Nicholas Larkman, Martin O’Neill, Adrienne Roberts, Carole
Spary, Kika Sroka-Miller, Ted Svensson, Matthew Watson and anonymous
referees, all of whom have provided extremely useful comments and
observations, either during ongoing discussions about the subject matter of the
book, or on earlier drafts. All of these suggestions and discussions have
contributed to improving the final text. The support and encouragement of
friends and family while I was writing the book are, as ever, greatly appreciated.
Finally, I would like to thank Ian Paten for his hard work in copy-editing the
manuscript.
INTRODUCTION: CAPITALISM AND ITS
ALTERNATIVES
Introduction
The collapse of sub-prime mortgage markets, which led to the failure of some
financial institutions, the bailout of others, and the subsequent recession, has had
profound implications. In Europe, both Greece and Spain have seen
unemployment reach unprecedented heights of over 25 per cent. In May 2013,
youth unemployment Europe-wide was 23.1 per cent; in Greece it was as high as
59.2 per cent and in Spain 56.5 per cent (Eurostat 2013). The focus on the
sovereign debt positions of many states, especially Portugal, Italy, Ireland,
Greece and Spain, has exacerbated these problems as public sector employment
has been cut alongside welfare budgets. However, it is not just the peripheral
European economies which have been affected, as unemployment in the United
Kingdom and the United States has reached levels of 8 per cent and 7.5 per cent
respectively (ibid.). Like Portugal, Italy, Ireland, Greece and Spain, the United
Kingdom and the United States have both used austerity as one of the primary
forms of crisis response, and a recent report estimated that austerity will have
come at a cost of 2 million American jobs by 2019 (CAP 2013).
The consequences of the global financial crisis have therefore been felt
acutely at a social level throughout Europe and the world. In light of the fact that
the crisis originated with the imprudent behaviour of financial actors, and the
fact that costs associated with the crisis have been socialized in the form of
unemployment and welfare retrenchment, it is perhaps unsurprising that there
has been an upsurge of discontent about the way in which the capitalist system
operates. This has been clearly manifested in the form of the Occupy movement,
which has been one of the primary modes of resistance to the prevailing form of
capitalism through its occupations of public spaces in New York, London and
elsewhere. Discontent about how the benefits of the capitalist system are
distributed has been clearly manifested in the slogan that it has popularized:
‘we are the 99 per cent’.
The global financial crisis of the late 2000s, the distribution of the benefits of
the way the system operated, and the distribution of the costs of the way it was
saved, provide strong reasons to think about whether capitalism is a desirable
form of social and economic organization. However, this reasoning is amplified
by the fact that it is not the first time that the capitalist system has found itself in
crisis. In the 1930s, the Great Depression led to widespread unemployment that
provoked international economic competition and contributed to the onset of the
Second World War. This represented the ultimate socialization of the costs of
capitalist failure; as John Holloway (1995: 21) phrased it, after the Great
Depression and the Second World War ‘capital could deal again and, over the
bodies of twenty million people, a fresh game could start’. In the 1970s, the
global economy once again found itself in crisis as many countries were faced
with rises in unemployment occurring along with stagnant growth – the
phenomenon of stagflation. While the crisis did not lead to war as it did in the
interwar period, the 1970s stagflation nonetheless resulted in widespread cuts in
welfare that meant people were exposed even further to the rigours of the
marketplace. As such, if the market could not provide them with employment,
people had increasingly less to fall back on for their well-being.
Although periods of vast economic growth, such as the years immediately
following the Second World War and the 1990s and early 2000s, have suggested
that ‘such episodes have finally been overcome, and the cycles of boom and
bust banished, these hopes have always turned out in the end to be illusory’
(Gamble 2009: 6). As responses to previous crises have not appeared to generate
greater or longer-lasting stability, the rationale for asking questions about the
origins of crises in capitalism and potential solutions to them could not be
stronger. In light of this rationale, this book asks four questions about capitalism.
First, it asks how wealth is created and used in capitalism, and what role the state
plays in facilitating the creation of wealth. Secondly, it asks how capitalism is
related to crisis, and specifically, whether capitalism displays an inherent
tendency towards crisis that ultimately means an alternative system of
organization is required if stability is to be achieved. Thirdly, the book asks what
kind of alternative systems of organization might be realized, and what their
consequences could be. Finally, the book asks how individuals and groups of
individuals could create such an alternative form of social organization.
A note on terminology The book will draw on four core concepts. The first of
these is capitalism. The term capitalism is used throughout the book to refer to
the prevailing form of social organization. While acknowledging that the ways in
which capitalism operates and the implications of these operations are contested,
this book defines capitalism in terms of one commonly accepted distinguishing
feature: that capitalism is a system that organizes the production, distribution and
exchange of goods, on the basis of private property, with a view to realizing
profit and therefore increasing wealth. The second term is alternative capitalism,