Book Review: Global Capitalism and the Crisis of Humanity

 

Part I: According to Robinson…

At this point, civilization of humanity is in the era of globalization. Due to the progress of technology, productivity and capital accumulation has exponential growth since the Industrial Revolution. The advent of Internet (computer-information technology) deepens and widens the global integration in all dimensions of human life. Capitalism is the ideological label of the contemporary social relation. In Marxism, human history can be divided by stages based on the evolution of productivity and its corresponding class relation. Although the notion of “nation-state” has developed as the modern political structure since the establishment of Westphalian system in 1648, the current society is divided into two classes essentially—bourgeoisie and proletariat in the stage of Capitalism. According to the prevailing viewpoint (realist) of international relation, nation-states are the units of the global arena. As a sovereign entity, politicians deal with foreign affairs and make domestic policies with the orientation of national interest. In another term, border matters. Citizens within the border are the part of the interest consideration to cover. For a long while since the universal adoption of “nation-state” and its corresponding governmental organization, this point had been true. We can see from the history that powerful countries imposed imperialism globally to maximize their own economic benefit and political influence; countries erected trade barriers to breed the growth of domestic industries; nations fought against nations to gain independence; so on and so forth.

However, this kind of ideology has becoming outdated in acceleration since the step-in of neo-liberalism and computer-information technology (CIT) in the 1970s. The leading role of globalization in the 21st century is no longer of trade, but transnational production, service, and capital. A corporation might has the headquarter in the US, raw resources from South America, engineers from East Europe, core managers or decision makers from the Middle East, component supply and assembling line in China, customer service in India, and market in all over the world. Its products or services fit to the taste of the local markets. Financing from multiple sources. It has investment in multiple projects of different companies. It shares interests with the cooperated corporations from developed and developing countries. In today’s society, Marxist class line of Capitalism becomes clear even though the contents of bourgeoisie and proletariat have many layers. The global elites, whether in real economic (economics that create tangible values) sectors or in financial sectors, cooperate to manipulate the global wealth, politics, culture, and information. Factors like nationality, ethnicity, race, religion, and cultural background, are no longer, at least less than the past, important identity of them. Common interests matter.

There are three categories of crises in Capitalism—cyclical, structural, and systematic. Cyclical crisis is periodic market adjustment; reasons might be fluctuation of the market or gradual change of the productive structure due to technological advancement; about once in ten years. Structural crisis is caused by contradictions of Capitalism. It needs adjustment in the structure with policy change in order to keep the system going. The Great Depression of 1930s introduced Fordist-Keynesian model or redistributive Capitalism to balance the influence of market and government. At the same time, WWII and post-war reconstruction absorbed the excess productions and energized the consumption. The core idea is that the system needs redistribution of wealth to undermine the conflict of overaccumulation and underconsumption. The 1970s crisis introduced neo-liberalism as economic ideology and globalization. Fortunately, the collapse of Communist bloc and development of the Third-World countries absorbed the overaccumulation. The CIT made globalization of trade, production, and capital running. The core idea is that overaccumulation in forms of production and capital has outlets to release; the organic economy keeps the system going. As for the Great Recession of 2008, since the globe has already saturated by hyperaccumulation and the touches of Capitalism, we are still living in the gloom of recession without any effective solutions or breakthroughs. The 2008 crisis might escalate to systematic crisis. In Marxism, Capitalism has innate contradiction that cannot be resolved. Capitalists look for opportunities to invest in order to create more accumulation. They maximize profits through increasing productive efficiency, such as shorten unit hour of production and minimize the wage payments to working class. Since profit is the incentive to produce, the aggregate profit must be higher than the wage in order to keep the system going. Therefore, consumption is lower than the accumulation. The crisis of redistribution is inevitable if gap between overaccumulation and underconsumption is too large. The fundamental root of the 2008 crisis is hyperaccumulation.

Financial speculation has complemental relationship with hyperaccumulation. With the assistance of CIT and dominance of the transnational capitalist class, capitals move around the world frictionlessly and instantaneously. Financial elites play the leading roles of the system. They come up with many novel financial products to fund projects and keep up the capital mobility. The size of fictitious capital, which is capital without the support of real production and service, outpaces the size of real economy in an accelerative rate. US has increasing deficit because it plays the role of market of last resort. Accordingly, US consumer debt is also increasing because lending enables them to consume. If US consumers fail to consume or fulfill the responsibility of debt payments due to the breakdown of credits or insolvency of the financial institutions, global crisis would occur because the accumulation of consumer goods and credits has no way to go (this is actually the case of 2008 crisis). Since China has excess amount of savings, US debt market becomes the outlet for these capitals. The credits in the financial market enable the US public to consume. In turn, consumption creates profits for the exporters and their component providers in China. Chinese economy booms and more capitals are accumulated. Then the circuit keeps going.

Militarized accumulation is another outlet of overaccumulation. In the US, military budget is increasing and policy of gun control is controversial because the industrial sectors of ammunition frenziedly lobby for their interests and they do contribute a lot to the US economy. It is profitable to fight wars or topple the disobedient regimes overseas. It is necessary to sell ammunition to sustain the economy. Robinson mentions about the notion of military security industrial construction petroleum engineering complex. The complex has transnational corporation sectors, labors, and capitals. The US plays the pivotal role in sustaining the system.

Confronting to the possible systematic crisis of Capitalism, Robinson points out the possible rise of 21st century Fascism—a fusion of transnational capital with reactionary political power. Besides the overaccumulation, we also have the problem of surplus population. Due to the advancement of technology and increase of productivity, many people suffer from dislocation because their adjustment cannot catch up with the speed of machine replacement and global reallocation of labor. In the US, the mass base would be a displaced white privilege sector of working class. They adopt the value of white supremacy and fail to accept dislocation or downward mobility in living standard and social status. They respond with resistance, rebellion, racism, and xenophobia. We can see this trend has happening in the US and West Europe. Good examples include Trump won the presidency and UK withdrew from EU. In those countries, civilians, especially the dislocated labors, express emotion and action of xenophobia. Politicians respond to the demand of their citizens and come up with anti-immigrant and anti-refugee policies. The scapegoats of the emerging Fascism are immigrants and Muslims. Some religious groups preach about radical or fundamentalist ideas with biblical doctrines to legitimize enmity toward Muslims. Most importantly, it is not uncommon that the media criminalizes and satanizes Muslims in terms of their culture and regimes, especially after the 911 attack. This is the militarization of culture and social relation.

Finally, Robinson points out the notion of “coercive mechanism”. In order to control the potentially unrest surplus population and maintain the social stability, some countries, like the US, transform from social welfare system to social control states, following with police states. In the US, security systems, such as prisons, gated communities for the riches, ammunition industries, etc., are privatized. The beneficiaries of these industries build a prison industrial complex to imprison undocumented immigrants and other disadvantaged groups. They lobby for policies to constrain immigrants, because it is so profitable to run the business. The core is that the prison industrial complex is a component of accumulation.

Part II: I think…

Robinson’s view about Capitalism, economic and financial crises, ideas about globalization in terms of transnational industry and capital, and prediction of 21st century Fascism are insightful. I agree with the current situation of overaccumulation and globalization of integration. I am not confident to say that Marxist or Robinson’s model about evolution of social relation is right, but I am confident to say that the trend of globalization of greater integration is accelerating and cannot be reversed even though some people impose the ideas of isolationism or protectionism. Because it is the main flow of human civilization, human make the effort to increase the scale and efficiency of communication. The coercion from the government to restrict communication cannot sustain for a long term.

However, I do not think the world has already been saturated by Capitalism. Many regions in the south hemisphere still suffer from poverty and lack of industrialization. That is why China tries to increase investments and proposes its One Road One Belt policy in the regions with potential market. Since China also faces the overaccumulation problem, business sectors come up with many ideas to stimulate domestic consumption in one hand; in another hand national foreign policies encourage oversea investments in real economy and infrastructure development in underdeveloped countries. The point that China sends labor, resource, technology, and capital to support the infrastructure building in those lack-of-fund regions is establishing a functioning market to release its overaccumulation.

Second, the ongoing innovation of new technology might be the way to resolve the crisis of humanity that Robinson mentions. From the history, a lot of problems cannot be resolved in a time period. However, when new innovations come up, many social problems are gone. Technology can create new opportunities and restructure social fabric. Furthermore, the space that outside of the Earth is almost untouched by human activities. I think the future has many possibilities for human beings to explore and discover.

 

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