Socialism: The Only Practical Alternative to Contemporary Capitalism

10. Summary and Socialist Transformation

141 Chapter 10 Summary and Socialist Transformation Overview Socialism is no longer the scare word of the past. Socialism involves the large-scale reorganization of the economy, the transfer of trillions from the coffers of predator classes’ of no social utility to the public welfare. This change can finance a productive and innovative economy based on work and leisure, study and sport. Socialism replaces the everyday terror of dismissal with the security that brings confidence, assurance and respect to the workplace. Workplace democracy is at the heart of the vision of 21st century socialism. We begin by nationalizing the banks and eliminating Wall Street. Financial institutions are redesigned to create productive employment, to serve social welfare and to preserve the environment. Socialism would begin the transition, from a capitalist economy directed by predators and swindlers and a state at their command, toward an economy of public ownership under democratic control. Introduction Contemporary capitalism, sanitized as globalization at a minimum involves the creation of a world economy that is not merely the sum of its national economies, but rather a powerful independent reality, created by the international division of labour and the world market that, in the present epoch, predominates over national markets. Large scale, long-term flows of capital, commodities, technology and labour across national boundaries define the process of globalization. Unfortunately for mankind, this contemporary capitalism has enduringly as well as inevitably created crucial contradictions which cannot easily be overcome. 142 Among these are the inability to generate sufficient employment, inequality on a global scale, the continuation of imperialism and imperialist wars, continued enclosure of the earth’s resources, pauperization, ecological crises, over-production and under consumption, the enormous waste of human potential on a global scale, and the forging of a global working class which is in an ever more precarious position even as net global wealth increases. Worse off still, this dominant mode of production tends to fragment consciousness, drowning class awareness in a sea of consumerism, which is making organizing and class struggle to overthrow it more difficult. What is undeniable today is the move from Crises to Recovery of Profits: 2008/9 to 2012. The key to the ‘recovery’ of corporate profits had little to do with the business cycle and all to do with Wall Street’s large scale takeover and pillage of the US Treasury. Between 2009-2012 hundreds of former Wall Street executives, managers and investment advisers seized all the major decision-making positions in the Treasury Department and channelled trillions of dollars into leading financial and corporate coffers. They intervened financially troubled corporations, like General Motors, imposing major wage cuts and dismissals of thousands of workers. Wall Streeters in Treasury elaborated the doctrine of “Too Big to Fail” to justify the massive transfer of wealth. The entire speculative edifice built in part by a 234 fold rise in foreign exchange trading volume between 1977-2010 was restored (Financial Times of 1/10/12, p.7). The new doctrine argued that the state’s first and principle priority is to return the financial system to profitability at any and all cost to society, citizens, taxpayers and workers. “Too Big to Fail” is a complete repudiation of the most basic principle of the “free market” capitalist system: the idea that those capitalists who lose bear the consequences; that each investor or CEO, is responsible for their action. Financial capitalists no longer needed to justify their activity in terms of any contribution to the growth of the economy or “social utility”. According to the current rulers Wall Street must be saved because it is Wall Street, even if the rest of the economy and people sink (Financial Times of 1/20/12, p.11). State bailouts and financing 143 are complemented by hundreds of billions in tax concessions, leading to unprecedented fiscal deficits and the growth of massive social inequalities. The pay of CEO’s as a multiple of the average worker went from 24 to 1 in 1965 to 325 in 2010 (Financial Times of 1/9/12, p.5). The ruling class flaunts their wealth and power aided and abetted by the White House and Treasury. In the face of popular hostility to Wall Street pillage of Treasury, Obama went through the sham of asking Treasury to impose a cap on the multi-million dollar bonuses that the CEO’s running bailed out banks awarded themselves. Wall Streeters in Treasury...