As such, this crisis signals the end of the 1990s project of the New Economy, the idea that capitalism can be revitalized in its digital form, with programmers and other intellectual workers turning into ‘creative’ capitalists (the dream embodied in the journal Wired). That’s why stronger and stronger state intervention is needed to keep the system viable. We should not miss the double irony here: there is some truth in the claim that state-socialism disintegrated in 1990 because it was not able to adapt itself to the digitalization of economic and social life; however, the same traditional Marxist notion of the contradiction between productive forces and relations of production is now undermining capitalism itself. (Basic income should thus be re-conceptualized not as an extended support of the unemployed, i.e., as a redistributive measure of social security, but as a financial recognition of the fact that, in a knowledge-based-economy, collective productivity of the ‘general intellect’ is the key source of wealth.) Communism remains the horizon, the ONLY horizon, from which one can not only judge but even adequately analyse what goes on today – a kind of immanent measure of what went wrong. That’s why one should abandon the ‘neo-Ricardian compromise between wage labour and productive capital against the power of finance’, (Carlo Vercellone) which tries to resuscitate the Social-Democratic welfare-state model: every demonization of financial capital is a manoeuvre to obfuscate the basic antagonism of capitalist production by transposing it onto ‘parasitic’ financial capital. And one should no less reject attempts at what one cannot but ironically call ‘Left Friedmanism’, the idea advocated by Wang Hui (among others), according to which what we are witnessing today is not the consequence of the market economy but its distortion: ‘resistance against monopolization and domineering market tyranny cannot be simply equalled with the struggle “against” the market, because such social resistance itself includes the efforts striving for fair competition in the market and for economic democracy.’(Wang Hui) Recall Habermas’s notion of distorted communication (distorted because of extra-linguistic power relations of oppression and domination): Wang Hui seems to imply the notion of distorted market competition and exchange – distorted due to the external pressures of political, cultural and social conditions: the movement of economy is always embedded in politics, culture and other social conditions, so to strive for the conditions of fair market competition does not equal getting rid of the state political system, social customs, and any regulating mechanism. On the contrary, the perfecting of market conditions aims to reform, limit, and expand these systems in order to create social conditions for fair interaction. In this sense, the struggle for social justice and fair market competition cannot be equalled with the opposition to state intervention. It rather requires socialist democracy, namely, to prevent the state from becoming the protector of domestic monopoly and multinational monopoly through the society’s democratic control of the state. Here, one should remain shamelessly orthodox Marxist: Wang Hui underestimates the immanent logic of market relations, which tends towards exploitation and destabilizing excesses. Are we substantializing economy too much here? It would be easy to perform the standard deconstructionist operation on ‘economy’ and claim that there is no Economy as a substantial unified field, that what we designate as ‘economy’ is an inconsistent space traversed by a multitude of practices and discourses: material production from primitive hand labour to automated production, money operations, publicity machines, interventions of state apparatuses, legal regulations and obligations, ideological dreams, religious myths, tales of domination, suffering and humiliation, private obsessions with wealth and pleasures, and so on. While this is undoubtedly true, there is nonetheless not a deeper ‘essence’ of Economy, but rather something like a ‘mathem’ of capital, a formal matrix of the self-reproduction of capital, like that which Marx was trying to elaborate in his Capital. This mathem, this trans-historical and trans-cultural formal matrix, is the ‘real’ of capital: the thing that stays the same through the entire process of global capitalism, the madness of which becomes palpable in moments of crisis. Marx describes the contours of this madness when he talks about the traditional miser as ‘a capitalist gone mad’, hoarding his treasure in a secret hide-out, in contrast to the ‘normal’ capitalist, who augments his treasure by throwing it into circulation: The restless never-ending process of profit-making alone is what he aims at. This boundless greed after riches, this passionate chase after exchange-value, is common to the capitalist and the miser; but while the miser is merely a capitalist gone mad, the capitalist is a rational miser. The never-ending augmentation of exchange-value, which the miser strives after, by seeking to save his money from circulation, is attained by the more acute capitalist, by constantly throwing it afresh into circulation. (Marx) This madness of the miser is nonetheless not something which simply disappears with the rise of ‘normal’ capitalism or its pathological deviation. It is, rather, inherent in it: the miser has his moment of triumph in the economic CRISIS. In a crisis, it is not – as one would expect – money which loses its value, and we have to resort to the ‘real’ value of commodities; commodities themselves (the embodiment of ‘real [use] value’) become useless, because there is no one to buy them. In a crisis, money suddenly and immediately changes from its merely nominal shape, money of account, into hard cash. Profane commodities can no longer replace it. The use-value of commodities becomes value-less, and their value vanishes in the face of their own form of value. The bourgeois, drunk with prosperity and arrogantly certain of himself, has just declared that money is a purely imaginary creation. ‘Commodities alone are money,’ he said. But now the opposite cry resounds over the markets of the world: only money is a commodity… In a crisis, the antithesis between commodities and their value-form, money, is raised to the level of an absolute contradiction. (Marx) Does this not mean that at this moment, far from disintegrating, fetishism is fully asserted in its direct madness? In crisis, the under-lying belief, disavowed and just practised, is thus directly asserted. And the same holds for today’s ongoing crisis, one of the spontaneous reactions to which is to turn to some commonsense guideline: ‘Debts have to be paid!’, ‘You cannot spend more than you produce!’, or something similar – and this, of course, is the worst thing one can do, since in this way, one gets caught in a downward spiral. First, such elementary wisdom is simply wrong – the United States was doing quite well for decades by spending much more than it produced. At a more fundamental level, we should clearly perceive the paradox of debt. The problem with the slogan ‘You cannot spend more than you produce!’ is that, taken universally, it is a tautological platitude, a fact and not a norm (of course humanity cannot consume more than it produces, like you cannot eat more food than you have on the plate), but the moment one moves to a particular level, things get problematic and ambiguous. At the direct material level of social totality, debts are in a way irrelevant, inexistent even, since humanity as a whole consumes what it produces – by definition one cannot consume more. One can reasonably speak of debt only with regard to natural resources (destroying the material conditions for the survival of future generations), where we are indebted to future generations which, precisely, do not yet exist and which, not without irony, will come to exist only through – and thus be indebted for their existence to – ourselves. So here, also, the term ‘debt’ has no literal sense, it cannot be ‘financialized’, quantified into an amount of money. The debt we can talk about occurs when, within a global society, some group (nation or whatever) consumes more than it produces, which means that another group has to consume less than it produces – but here, relations are by no means as simple and clear as they may appear. Relations would be clear if, in a situation of debt, money was a neutral instrument measuring how much more one group consumed with regard to what it produced, and at whose expense – but the actual situation is far from this. According to public data, around 90 per cent of money circulating is ‘virtual’ credit money, so if ‘real’ producers find themselves indebted to financial institutions, one has good reasons to doubt the status of their debt: how much of this debt is the result of speculations which happened in a sphere without any link to the reality of a local unit of production? So when a country finds itself under the pressure of international financial institutions, be it the IMF or private banks, one should always bear in mind that their pressure (translated into concrete demands: reduce public spending by dismantling parts of the welfare state, privatize, open up your market, deregulate your banks …) is not the expression of some neutral objective logic or knowledge, but of a doubly partial (‘interested’) knowledge. At the formal level, it is a knowledge which embodies a series of neoliberal presuppositions, while at the level of content, it privileges the interests of certain states or institutions (banks etc.). When the Romanian Communist writer Panait Istrati visited the Soviet Union in the late 1920s, the time of the first purges and show trials, a Soviet apologist trying to convince him about the need for violence against the enemies of the Soviet Union invoked the proverb, ‘You can’t make an omelette without breaking eggs,’ to which Istrati tersely replied: ‘All right. I can see the broken eggs. Where’s this omelette of yours?’ We should say the same about the austerity measures imposed by the IMF, about which the Greeks would be fully justified in saying: ‘OK, we are breaking our eggs for all of Europe, but where’s the omelet you are promising us?’ If the ideal of financial speculation is to get an omelette without breaking any eggs, in a financial meltdown we end up with just broken eggs, as was the case in Cyprus. Recall the classic cartoon scene of a cat which simply continues to walk over the edge of the precipice, ignoring the fact that she no longer has ground under her feet – she falls only when she looks down and notices she is hanging over the abyss. Is this not how ordinary people in Cyprus must feel these days? They are aware that Cyprus will never be the same, that ahead lies a catastrophic fall in living standards, but the full impact of this fall is not yet properly felt, so for a short period they can afford to go on with their normal daily lives, like the cat who calmly walks in the empty air. And we should not condemn them. Such delaying of the full impact of the crash is also a survival strategy: the real impact will come silently, when the panic is over. This is why it is now, when the Cyprus crisis has largely disappeared from the media, that one should think and write about it. Back to the joke about Rabinovitch, it is easy to imagine a similar conversation between a European Union financial administrator and a Cypriot Rabinovitch today. Rabinovitch complains: ‘There are two reasons we are in a panic here. First, we are afraid that the EU will simply abandon Cyprus and let our economy collapse …’ The EU administrator interrupts him: ‘But you can trust us, we will not abandon you, we will tightly control you and advise you what to do!’ ‘Well,’ responds Rabinovitch calmly, ‘that’s my second reason.’ Such a deadlock is at the core of Cyprus’s sad predicament: it cannot survive in prosperity without Europe, but nor can it do so WITH Europe. Both options are worse, as Stalin would have put it. Recall the cruel joke from Lubitsch’s To Be Or Not to Be: when asked about the German concentration camps in the occupied Poland, the responsible Nazi officer, ‘concentration-camp Erhardt’, replies: ‘We do the concentrating, and the Poles do the camping.’ Does the same not hold true for the ongoing financial crisis in Europe? The strong Northern Europe, centred on Germany, does the concentrating, while the weakened and vulnerable South does the camping. Visible on the horizon are thus the contours of a divided Europe: its Southern part will be more and more reduced to a zone with a cheap labour force, outside the safety network of the welfare state, a domain appropriate for outsourcing and tourism. In short, the gap between the developed world and those lagging behind is now opening within Europe itself. This gap is reflected in the two main stories about Cyprus, which resemble the two similar stories about Greece. There is what can be called the German story: free spending, debts and money laundering cannot go on indefinitely. And there is the Cyprus story: the brutal EU measures amount to a new German occupation which is depriving Cyprus of its sovereignty. Both stories are wrong, and the demands they imply are nonsensical: Cyprus by definition cannot repay its debt, while Germany and the EU cannot simply go on throwing money into the bottomless Cypriot financial hole. Both stories obfuscate the key fact: that there is something wrong with a system in which uncontrollable banking speculation can cause a whole country to go bankrupt. The Cyprus crisis is not a storm in the cup of a small marginal country, it is a symptom of what is wrong with the entire EU system. This is why the solution is not just more regulation to prevent money laundering and so on, but (at least) a RADICAL CHANGE IN THE ENTIRE BANKING SYSTEM – to say the unsayable, some kind of SOCIALIZATION OF BANKS. The lesson of crashes that accumulated worldwide from 2008 onwards (Wall Street, Iceland, and so on) is clear: the whole network of financial funds and transactions, from individual deposits and retirement funds up to the functioning of all kinds of derivatives, will have to be somehow brought under social control, streamlined and regulated. This may sound utopian, but the true utopia is the notion that we can somehow survive with small cosmetic changes. But there is a fatal trap to be avoided here: the socialization of banks that is needed is not a compromise between wage labour and productive capital against the power of finance. Financial meltdowns and crises are obvious reminders that the circulation of Capital is not a closed loop which can fully sustain itself – i.e. that this circulation points towards the reality of producing and selling actual goods that satisfy actual people’s needs. However, the more subtle lesson of crises and meltdowns is that there is NO RETURN TO THIS REALITY – all the rhetoric of ‘let us move from the virtual space of financial speculation back to real people who produce and consume’ is deeply misleading; it is ideology at its purest. The paradox of capitalism is that you cannot throw out the dirty water of financial speculations and keep the healthy baby of real economy: THE DIRTY WATER EFFECTIVELY IS THE ‘BLOODLINE’ OF THE HEALTHY BABY. Slavoj Žižek. TROUBLE IN PARADISE: From the End of History to the End of Capitalism, Penguin, 2014, ebook, chap.1
Posted on: Mon, 26 Jan 2015 02:53:00 +0000
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