Capital in Crisis Environment in Crisis [Part II]
By Farooque Chowdhury
03 October, 2010
The crises the present world order has generated are fundamentally two: the crisis of capital and the crisis of environment, and these two are connected to each other. The Great Financial Crisis has been generated by the monopoly-finance capital in its speculation venture, its speculation with finance, with bubbles that it built on the base of profit and manipulated prices, that it built with manipulated financial instruments, even with imagined possibilities of risks, with manipulated and corrupt ratings, and thus with all the financial instruments and transactions the financial commodity was created. The finance-commodity has weakened its relations with other commodities, historically determined socio-production relations, from manufacturing sector and with the manufacturing sector. A contradiction was generated that has weakened the capital engaged in speculation with financial commodities. It tried to resolve the contradiction by intensifying class war, a part of which was pressing down real wages, and by intensifying the process of appropriating societies in the periphery. Nevertheless, that attempt has intensified competition and the already existing contradictions, and has generated new contradictions, in the market, the market that depends on consumption for regeneration of capital, in the ranks of the wage earners, and at the global level, in the sectors related to food and fuel production, and with the other centers of monopoly-financial capital. The later one, in the form of competition and politics, made impact in the politics of other countries, and in geopolitics. The higher rate of profit resisted the monopoly-finance capital from getting engaged into research and development also.
The food crisis is a combination of crises in agriculture, class interests, capitals involved, distribution, ecology, energy, speculation. The politics related to the food crisis comes out from the involved capitals, and has played its characteristic role, standing by the capitals and against the producers and consumers until the crisis took the form dangerous to the rule of capital. Food, agriculture, and energy are parts of environment. The crisis in agriculture is a combination of crises in soil and water management, of contradictions in class interests, of manufacturing and trade interests, the interests involved in manufacturing, trading, and transportation of chemical products and implements used in agriculture, and trading of fuel. The agriculture crisis increased because of capital’s adventure for appropriation from agriculture, for appropriating soil, and to resolve energy crisis. Thus, capital created a new crisis in agriculture in its effort to fly away from the clutches of energy crisis. But, it failed to forget its driving motive, profit, while it stepped into the world of agriculture to escape energy crisis. This is inherent in capital. It cannot operate in some other way other than a predestined path determined by its nature. Energy – oil, natural gas, renewables, nuclear, etc. – is part of environment and affects environment. But, involvement, type, sector, sub-sector or level, of capital in energy is determined by rate of profit. Over-exploitation, indiscriminate use and misuse, investment, R&D, etc. are determined by profit, and these have impact, immediate and long-term, on environment. Trading is also involved there. The “way of life”, not only in the metropolis of the world system, but also in the periphery is determined by capital and capital behaves on the basis of profit, relating it to the “way of life” all over the world, and in the speculation bazaar. This in turn makes impact in the environment that is pushed to dangerous level by snapping the relationship between human society and nature and by making nature subservient to profit. The issue of climate change needs no explanation after looking into these businesses of capital. With the domination of speculation market the entire situation aggravates.
This reality exposes the inefficiency of capital that undermines the survival of human being. It shows capital’s inability to resolve the contradictions generated by itself. The trajectory of the crises goes through politics, mainly harming and/or threatening or posing to harm and/or threat the ruling machine, the world system, the dominant classes and their ideology. Geopolitics for domination of the world by different sections of the world system and security of dominant powers are also influenced by these crises. This in turn sharpens contradictions in the dominant camp and creates possibilities for weakening of the machines for dominance.
Profiteering from the crises and putting the burden of crises on the dominated is the way capital seeks to get out of the crises, an inherent capacity and incapacity of capital that increases the magnitude of the crises, and creates new crises including eroding credibility and acceptability of dominance with the possibilities of emergence of newer factors in politics, sometimes at a slower pace, but at times, faster than imagination, as steps by history are dependent upon and relative to contradictions within economy. Society, politics, ideology, philosophy, and culture that include education and science get impregnated with these contradictions that in turn make capital’s capacity to resolve the contradictions difficult and thus worsen the situation. Capital cannot resolve the contradiction between limited resources and equitable distribution as profit stands in between these. The entire process threatens the existence of humanity as humanity with its common interest stands at the opposite pole of capital that owns only its own narrow interests. Other than opposing capital there remains no alternative available to humanity for its existence. This age of crises brings forth this reality, where compromises embolden capital in its last ditch attempt.
[This is the 2nd part of the introduction of The Age of Crisis by Farooque Chowdhury being serialized in Countercurrents.]