Responding to capitalist crisis – extending the debate
By Sunil Bastian
Not long ago we were told that cyclical crises of capitalism were a thing of the past. It was believed that in a period of globalisation, capitalism had found a way of avoiding these periodic downturns. Liberal mythology argued that if we organise our societies on the basis of liberal market policies and representative liberal democracy as found in the west, everybody would live happily ever after. These myths are exploding in front of our eyes.
The depression of 1929 had immediate repercussions in the west and later on for the colonised countries. It contributed to the consolidation of the power of national socialism in Germany and ultimately to the Second World War. As brilliantly analysed by Adam Tooze, in his recent book on economic history of the Third Reich, the collapse of the American economy and British decision to abandon gold standard undermined the position of those in Germany who looked towards the international system to solve the economic problems that Germany was facing. Given the global economic disaster, ‘ it appeared to many that international economic dependence was actually the problem. Nationalist visions, visions of a future in which global financial connections were not the determining influence in nation’s fate, now had greater plausibility.’ These ideas helped consolidate power of Nazism in Germany.
What is interesting in the case of the current crisis is the absence of such significant historical developments. What dominates at present is characterised by two ideas – a)The international system is intact and we can find answers to the current crisis within it. b) The most important thing to do is to rescue, support and rejuvenate capital. There is very little discussion of anything else. Especially the problems faced by the socially excluded in this crisis are forgotten.
Let me take my own country, Sri Lanka to illustrate these points. The social group that has been directly affected by this crisis is the working class in three sectors of the economy – plantations, garments and migrant labour. Plantations have an in-built system of managing the drop in labour demand. The entire production system that was established during the colonial period pays people only on the days that they get work. This labour regime has continued in the plantation system for more than a century and still serves the interest of capital when they want to lay off labour during slack times. The workers in the garment factories are simply laid off when there are no orders. Factories often maintain workers as casual labour so that they can lay off labour without being hindered by labour laws. Labour in the Middle East, who often work under medieval labour regimes without any rights, are simply sent home.
What is interesting to note is in all these sectors women form the bulk of the labour force. Bringing women into the work force in large numbers has been one of the biggest social impacts of opening up the economy three decades ago. A special feature in Sri Lanka is the labour of these women has carried a significant burden of an expensive war.
Despite these social repercussions affecting a significant section of the population, what dominates is a discourse that emphasises two issues – first how to support capital, and second how to continue with the war in the midst of the crisis. Although there are rumblings about reverting back to a closed economy and asserting economic nationalism it has not gained enough support. However if nationalists find that it is difficult to continue with the war because of the economic crisis, they would make use of nationalist arguments to promote autarkic answers. They would make use of the social impact of the crisis to promote such ideas.
It is necessary to extend the current debate on economic crisis to include the concerns of the socially excluded. However it is difficult to extend the current debate to include such issues if we base our analysis on totalising categories like the ‘global south’ and make relations between nation-states the key to our analysis. As critical theorist Robert Cox argues all theories are created for someone and for some purpose. In the current context the use of such generalisations in our analysis only serves the interests of capital. In many parts of the so-called ‘global south’ we are living in a context where there is rapid capitalist development. Supported by global structures, capital is changing social relations within our countries. Contrary to liberal mythology capitalism is bound to have cyclical crises. However if we do not have ideas to face these crises keeping in mind problems of the socially excluded, the political outcome can be the assertion of nationalist autarkies.