Laissez faire, market capitalism is inherently unstable and it’s own internal logic requires perpetual cycles of boom & bust in order to generate the rising and falling markets that generate profit. Indeed, the system is so unstable that it has to be ultimately underwritten by the state, which ultimately means by the funds provided by the taxes paid by ordinary citizens.
The current worldwide economic crisis was caused by the logic of unregulated capitalism and this unstable system was rescued by state intervention that in the UK alone amounted to £1.2 trillion! And note that’s trillion not billions.
The UK deficit is almost entirely due to this world-wide crisis in capitalism but the citizens of the UK are being asked to suffer wide-spread tax increases, job redundancies and cuts to public services in order to find the money to repay these trillions. i.e. UK citizens are being asked to literally pay for the rescue of the capitalist system.
One of the main reasons we are told we need to do this is to satisfy the demands of the markets, the very same markets that we rescued. So we have put our nation into crisis levels of debt to bail out a system that now tells us that this level of debt is not acceptable and that we need to be more fiscally responsible and reduce our spending on money hospitals, schools and social services – presumably because we need to keep substantial funds on standby to rescue the system again the next time it reaches crisis point.
All this might make perfect sense if the system we were propping up was of universal benefit to all citizens, indeed Socialists, including me, often argue in favour of large scale public spending to support systems and institutions we perceive provide a crucial public benefit – a free at the point of use University system for example.
But what the issue of Bankers Bonuses reveals is that this system is not of benefit to all, it is designed to benefit certain sections of society to the detriment of others. And again this is central to the logic of capitalism; the exploitation of the goods and services created by the labour of workers to generate profit for owners of capital underlies the logic of the whole system and rests on a feudal idea that certain sections of society have a moral and legal right to exploit and rule while others are destined to serve.
As a result the system proposes to resolve the current crisis by allowing the already wealthy “masters of the Universe” who operate and control capitalism at the highest level (the corporate managers and CEO’s, the non-executive board members, the Bank’s bosses, the hedge-fund managers and market traders etc), to continue to receive remuneration and bonuses beyond the imaginings of most citizens while the rest of us must make immense personal and social sacrifices to provide the funds to underwrite the system that pays these inflated salaries and bonuses.
In a reverse of the Robin Hood legend, the poor are being robbed to pay the rich and what is amazing it isn’t being done surreptitiously, it’s absolutely in-yer-face, most people can see this quite clearly but the “there is no alternative” discourse has been so persuasive that we seem incapable of mobilising to oppose this bare-faced shift of money from the poor to the rich.
The truth is:
1./ Unregulated, laissez faire capitalism is systematically unstable and unsustainable without state support and intervention.
2./ Western society is largely organised for the benefit of and according to the values and aspirations of a privately educated wealthy elite.
I Am Not A Number
Political and Philosophical Dispatches From An Individual Living In A Society