Today we publish the fifth part of the draft World Perspectives document of the IMT. In this final part we look into the effects of the crisis of capitalism on the consciousness of the masses.
Read the full document here
Inequality and the concentration of capital
Marx’s prediction that the development of capitalism would inevitably lead to the concentration of greater and greater wealth in fewer and fewer hands has been entirely vindicated by events. “Accumulation of wealth at one pole is, therefore, at the same time accumulation of misery at the opposite pole.” he wrote in volume one of Capital. That is precisely the situation we now find ourselves in. Everywhere there has been a sharp increase in inequality.
The sums involved are immense. Between 1993 and 2011, in the US, average incomes grew a modest 13.1 percent in total. But the average income of the poorest 99 percent—that is, everyone up to families making about $370,000 a year—grew by only 5.8 percent. That gap is a measure of just how much the top 1 percent are making. Workers’ share of US national income was 62 percent before the recession. It is now about 59 percent of GDP. Average household incomes are lower than before the recession as inequality rises.
It is a glaring paradox that the US stock market has risen by more than 50 per cent since the crisis, while median earnings have declined. Obscene wealth begets political power: plutocrats can buy up newspapers and television channels and fund political campaigns, parties and lobbying. In the USA, one has to be a millionaire to be President, and in must addition have the backing of many billionaires. Democracy can be bought and sold to the advantage of the highest bidder.
The myth of social mobility has been exposed for what it is: a cynical lie. Rich parents have rich children. The ruling class is a self-perpetuating elite that is entirely divorced from the rest of society. Access to higher education is increasingly expensive. Graduates find themselves saddled with enormous debts averaging $25,000 per student and are often unable to find jobs in the career of their choice—if they can find a job at all. The ladder to advancement has been kicked away. Hundreds of thousands of university graduates are serving hamburgers in McDonald’s or stocking shelves in supermarkets. The situation confronting US youth today is statistically similar to that faced by youth in the Arab world before the explosion of the Tunisian and Egyptian Revolutions.
The American dream has turned into the American nightmare. 47 million Americans are forced to resort to food stamps in order to have food for the end of the month. The growing sense of anger at this injustice was expressed in the slogan of the Occupy Movement in the USA: “We are the 99%”. The dangers in this situation are clear to the more far-sighted strategists of Capital.
An abysm between the classes
The masses are prepared to make sacrifices on condition that the cause is just and the sacrifices are the same for all. But nobody is willing to make sacrifices to save the bankers, and there is no question of equality of sacrifice. The bankers pocket the money generously doled out by the taxpayer (or rather, by the government, since nobody has asked the taxpayers’ opinion), paying themselves huge bonuses.
In the midst of a crisis, the rich get richer and the poor get poorer. Credit Suisse has published a chart showing the increase in the number of dollar millionaires (based on total assets, mid-2012 to mid 2013).
Spain: 402,000 (+ 13.2%)
US: 13,210,000 (+ 14.6%)
France: 2,210,000 (+ 14.9%)
Germany: 1,730,000 (+ 14.6%)
UK: 1,520,000 (+ 8.2%)
Italy: 1,440,000 (+ 9.5%)
China: 1,120,000 (+ 8.7%)
Canada: 993,000 (+ 4.7%)
Another Credit Suisse report published some interesting figures on unequal distribution of wealth. It revealed that at the top end, 32 million people control $98.7 trillion. That means that 41 percent of the world’s wealth is in the hands of 0.7 percent of the total adult population. Those with a personal fortune of $100,000 to $1 million account for 7.7 percent of the population, controlling some $101.8 trillion, representing 42.3 percent of the world’s wealth.
At the other extreme, 3.2 billion people control a mere $7.3 trillion. This means that 68.7 percent of the world’s adult population control just 3 percent of its wealth. This means that the richest 0.7 percent of the world's adult population have a combined personal wealth 14 times larger than the poorest 68 percent. These figures confirm Marx’s prediction concerning the concentration of Capital:
“Accumulation of wealth at one pole is, therefore, at the same time accumulation of misery, agony of toil slavery, ignorance, brutality, mental degradation, at the opposite pole, i.e., on the side of the class that produces its own product in the form of capital.” (Capital vol.1, chapter 25)
Lenin pointed out that politics is concentrated economics. For a whole period, at least in the advanced capitalist countries, capitalism seemed to be “delivering the goods”. The generation that grew up in the USA and Europe during the decades that followed the Second World War enjoyed the benefits of an unparalleled economic upswing: full employment, rising living standards and reforms.
This was the classical period of reformism in Europe. The capitalists could afford to permit reforms on the basis of an expanding economy and big profits. But that is no longer the case. The real programme of the bourgeoisie is to abolish the welfare state altogether, forcing the unemployed to work for any wages the employers choose to offer. That is to say, to go back to the times of Marx and Dickens. Only the power of organised labour prevents them from fully carrying out this social counter-revolution.
The perspective is one of years of cuts, austerity and falling living standards. This is a finished recipe for class struggle everywhere. The bourgeoisie demands the liquidation of debt, balanced budgets, the slashing of “wasteful” social spending (that is to say, spending on schools, hospitals and pensions, but not, of course, handouts to the banks). They argue, like true sophists, that although “in the short run”, such measures must lead to a significant economic contraction and a sharp fall in living standards (for some), in the long term, they would magically, create the foundation for “a sustainable recovery”. To which old Keynes would have answered: “In the long run we are all dead”.
So precarious is the situation that anything could trigger a major crisis; this is true of the economy (see the government shutdown in the USA and also growing debt in Europe) but also of society as a whole. Class struggle could also erupt through some event or other (the Belgian firefighters).
The question is posed for the bourgeoisie: how to govern in such a crisis situation? In many countries of Europe, the political impasse manifests itself in unstable coalitions and hung parliaments. The institutions of bourgeois parliamentary democracy are being tested to their limits.
The growth of abstention is a phenomenon that indicates growing disaffection with all the existing parties. This is hardly surprising, given the conduct of the labour leaders. Even when they are in opposition, the Social Democrats continue to support the general policy of cuts and austerity. This was shown clearly in the case of the Swedish SDP, the British Labour Party, the German SPD, the Spanish PSOE and the Pasok in Greece. It is this that produces moods of disappointment and apathy.
In Germany too there is a growing tendency towards abstentionism. Merkel won the elections, but even then she did not win a majority, and needed the SPD for a “grand coalition” government. 40% of the German electorate is not represented by any party in parliament; Die Linke's vote fell from its peak of around 12% to just below 9%. But nature abhors a vacuum, and the formation of a SPD-CDU coalition means Die Linke is the only real opposition and can begin to pick up support.
As a result, in several countries we have seen the rise of new parties: Greens (in Sweden), populists in Iceland and Italy (Grillo), “pirate parties” (Sweden, Germany, Iceland), and the rise of far-right parties (Greece, Sweden, Norway, France) and the anti-EU UKIP in Britain. All this represents a ferment in society, a deep malaise and dissatisfaction with the existing political order.
In Europe there is a growing discrediting of the institutions of bourgeois democracy, particularly in those countries which are hardest hit by the crisis. The old established two-party system (right wing vs. Social Democracy) is in crisis. Some of that discontent is being capitalised by parties to the left of Social Democracy, as witnessed by the growth of Syriza, IU and the French FdG. In Italy, where such a thing did not exist, the “5 star movement” of Grillo (a confused petty-bourgeois protest movement) has temporarily filled that void.
Still, even these parties do not offer a real alternative to the crisis of capitalism and are therefore not growing as fast as they could do if they reflected even partially the mood of anger in society. However, finding no echo in the reformist parties, the discontent of the masses is reflected in the political arena by an increase in abstention or spoilt ballots. In Spain, in 2008, the PP and PSOE concentrated 83% of the votes on a 75% turnout. Today, opinion polls give them barely 50% on a much lower turnout (around 50% now declare they will either not vote, or vote blank or don't know who will they vote—a record figure).
In Portugal we see a similar situation emerging from the recent municipal elections. Abstention increased by 550,000; spoilt and blank ballots doubled, with an increase of 170,000. The ruling right-wing coalition lost 600,000 votes; the Social Democratic PS in “opposition” lost 270,000; the Communist PCP gained barely 13,000 votes; while the left-wing BE lost 45,000 votes.
The mass organizations
The central problem is one of leadership. The labour leaders—both in the political parties and the unions, are living in the past. They have not understood the nature of the present crisis and dream of the possibility of returning to the “good old days”. They are organically incapable of breaking with the bourgeoisie and leading a serious struggle even to defend the conquests of the past, still less to fight for an improvement in living standards.
There is a sharp contrast between the burning anger of the working class and the passivity and helplessness of its leaders. The mass organisations, in general, are still on quite a low level of activity. Thus, there is no real pressure on the leaders to prevent them going even further to the right. This has been the general tendency in the last period. The degeneration of all the leaderships has reached unparalleled depths. It is a shocking fact that the very organizations that were created by the working class to change society have become transformed into powerful obstacles in the path of social transformation.
Historically, it is the role of the Social Democrats to demoralise the workers and push the middle class into the arms of reaction. Having long ago abandoned any pretence of standing for socialism, they address their speeches to the bankers and capitalists, adopting a “moderate” and “respectable” tone. They try to persuade the ruling class that they are fit to assume high office in the State. In order to prove their credentials to the bourgeoisie as reliable “statesmen” (and women), they are even more zealous than the Conservatives in carrying out cuts and counter reforms (always under the flag of “reform”).
The left reformists, who dominated the Socialist parties in Europe in the 1970s, have been reduced to a shadow of their former selves. Lacking a firm base in ideology or theory, they trail miserably behind the right wing. The latter are more confident because they feel they have the support of big business. By contrast, the Lefts have no confidence either in the working class or in themselves. The left-reformists in the unions are no better than their political counterparts. They stand condemned and have failed even on the most elementary grounds of consistently struggling to defend wages, conditions and trade union rights.
A whole series of “Left” governments have been ejected after carrying out cuts: Spain, Iceland, Norway, Greece and, somewhat earlier, Italy. Others have seen their support collapse and are likely to lose power in the next election (Denmark, France, Ireland). The Irish Labour Party was riding high in the opinion polls before it entered a bourgeois coalition that is carrying out cuts. Its support has collapsed, falling from 24% to 4%.
In Greece, the socialist party, Pasok, which had a mass base and at times votes of close to 50%, has seen its vote collapse as a result of carrying out the policies dictated by the ruling class and the EU. It was replaced first by the “national” government of Papademos, then joined the coalition with the right-winger Samaras. But the most important factor has been the rapid rise of Syriza, which originally struggled to obtain 4 or 5% and at one point reached 30% in the opinion polls.
However, the mass organizations, even the most degenerate, will at a certain stage inevitably reflect the pressure of the masses. In the coming period there will be violent swings of public opinion to the left—and to the right. We must be prepared for this and explain its real significance. In seeking a way out of the crisis, the masses will test—and discard—one party and leader after another. But a constant feature is the rejection of whoever has been in government carrying out an austerity programme.
In Britain, there are some indications that pressure from below (particularly from the unions) is forcing Miliband to distance himself from the Tories and Liberals. Miliband, however timidly, is reflecting the growing public anger against big business and the banks. Once in power the reformist leaders will be under extreme pressure from both the ruling class and the masses. They will be crushed between two millstones. There will be splits to the right and left. In some cases they can be destroyed altogether (the PRC in Italy and possibly the Pasok in Greece). But in every case they will enter into crisis.
As the crisis deepens, left tendencies will begin to crystallize inside the mass workers’ parties and unions. The Marxist Tendency must follow the internal life of the mass organizations closely and strive to reach and win over the leftward moving workers and youth who are looking for an alternative.
However, our ability to intervene effectively in the future will be determined by our success in building the Marxist Tendency today. It is not at all the same intervening in the mass movement with 20 or 50 cadres as with 500 or 1,000. Quality must be transformed into quantity, so that quantity in turn can be transformed into a qualitatively higher level. In order to move masses, it is necessary to possess a lever, and that lever can only be a strong and numerous Marxist tendency.
The unions are the most basic organizations of the class. In a crisis, the workers feel the need for the unions even more than in “normal” periods. In the industrial field there have been some very radical struggles and conflicts and whenever the trade union leaders have given a lead, in the form of general strikes, sectorial strikes, etc., the workers have responded massively. The problem is that the trade union leaders are completely impotent when faced with the crisis of capitalism as they really have no alternative (other than a mild form of Keynesian stimulus).
In Spain. there was an all-out strike of the teachers in the Balearic Islands which lasted for three weeks and attracted mass popular support (with a demonstration in Palma of around 100,000 on an island with a total population of around 800,000!). The strike was conducted with traditional class struggle methods which had been lost in the last period: mass assemblies, elected delegates, support from parents and students and a strike fund. However, the trade union leaders left the Balearic teachers on their own, refusing to spread the struggle beyond the teachers and to the mainland, and the movement had to retreat, defeated by exhaustion.
In these conditions it is not surprising that many workers are questioning the validity of 24-hour general strikes called in isolation, without a sustained plan of struggle by the trade union leaders. In fact, these are being used by the leaders as a means of blowing off steam. In Greece, the weapon of the one-day general strike has now become counterproductive. Calls for such actions are met with scepticism by the workers who understand that more drastic action is necessary. In the conditions of Greece, what is needed is an all-out political general strike to bring down the government.
We see both in the political and industrial front an accumulation of anger and discontent which so far finds no clear channel of expression. In Spain, Portugal, Greece, Italy, hundreds of thousands of youth are forced to emigrate in a return to a situation their parents thought they had left behind.
There are constant attacks on public health care and education systems, a growing epidemic of unemployment, particularly amongst the youth, the scandal of evictions and repossessions side by side with large numbers of empty flats and homes, a growing number of people living on the streets, many of whom thought of themselves as “middle class”, being pushed under the poverty line, etc.
Under these circumstances the workers more than ever see the unions as their first line of defence. All of these pressures will have to come to the surface, in a combination of spontaneous protest movements, explosions of anger, which will eventually have an impact in the mass organisations.
The first stages of mass radicalisation will be reflected in strikes, general strikes and mass demonstrations. We have already seen this in Greece, Spain and Portugal. But given the depth of the crisis, these actions alone cannot succeed in preventing new attacks on living standards.
Even in Belgium, where the militant action of the firefighters and railway workers forced the government to retreat, this will only be a temporary victory. What the government concedes with the left hand, they will take back with the right. In Greece, there have been close to thirty general strikes, but the government continues to attack.
Gradually, the workers learn through experience that more radical measures are necessary. They begin to draw revolutionary conclusions. Trotsky explained the importance of transitional demands as a means of raising the consciousness of the workers to the level demanded by history. But he also pointed out that in a situation of deep crisis, such demands are not enough:
“Of course the sliding scale and workers’ of self-defence are not enough. These are only the first steps necessary to protect workers from starvation and from the fascists’ knives. These are urgent and necessary means of self-defence. But by themselves they will not resolve the problem. The main task is to pave the way to for a better economic system, for a more just, rational and decent use of the productive forces in the interests of all the people.
“This can’t be achieved by ordinary, ‘normal’, routine methods of the trade unions. You cannot disagree with this, for in the conditions of capitalist decline insulated unions turn out to be incapable of halting even the further deterioration of the workers’ conditions. More decisive and deep-going methods are necessary. The bourgeoisie, which owns the means of production and possesses state power, has brought the entire economy to a state of total and hopeless disarray. It is necessary to proclaim the bourgeoisie bankrupt and to transfer the economy into fresh and honest hands, that is, into the hands of the workers themselves”. (Trotsky, Discussion with a CIO organiser, 29 September 1938)
The role of the youth
One of the main features of the present situation is the persistence of high levels of unemployment and under-employment, especially among young people. This is not the reserve army of unemployed of which Marx spoke. It is permanent, structural unemployment, organic unemployment that is like a poisonous ulcer gnawing at the entrails of society and corroding it from within.
The worst effects of unemployment are to be found in the youth, which has to bear the heaviest burden of the capitalist crisis. Youthful hopes and aspirations come up against an impenetrable barrier. This is all the more intolerable when an increasing number of the unemployed are highly educated. This creates a very combustible and volatile mixture.
This is the first generation of young people who cannot expect a better standard of living than their parents. They have been robbed of a future. A whole generation of youth is being sacrificed on the altar of Capital. Between Brazil and Turkey there are, of course, differences. But there are also common features that helped fuel discontent. The same features will nurture similar protests elsewhere. One important factor was youth unemployment.
This phenomenon is not confined to the poorer countries of Latin America, the Middle East and Asia. Unemployment and poverty are an explosive combination that can ignite at any time, in any country. Youth unemployment was a big factor in the so-called Arab Spring. High levels of youth unemployment in Europe can have a similar radicalising effect, Already, youth radicalisation is a generalised phenomenon to one degree or another across Europe.
In Britain, a wave of radicalisation among the students was followed by an explosion of rioting by unemployed youth in all the big cities that shook the establishment. In Greece, the big movements of the working class were preceded by a major movement of the school students. In Spain and the USA we had the Occupy movement and indignados, which were overwhelmingly composed of the youth. There are many historical precedents for this. The Russian Revolution of 1905 was preceded by the student demonstrations of 1900 and 1901. The May Days in France in 1968 were sparked off by student demonstrations that were brutally repressed by the police.
Lenin said: “He who has the youth has the future”. We must at all costs find a road to the revolutionary youth, giving a conscious and organized expression to their instinctive desire to fight injustice and oppression and win a better world. The success or failure of the IMT depends to a great extent on our ability to achieve this end.
Are the conditions ripe for revolution?
We are moving into an entirely new situation on a global scale. This is clear from the events of the last 12 months alone. Clouds of tear gas fill the streets of Istanbul. Police truncheons crack skulls in São Paolo and 17 million people overthrow an Egyptian president. Protests have erupted in Bulgaria. This is only the start of a wave of political discontent in the developing world, which is pregnant with revolutionary potential.
Dialectics teaches us that sooner or later everything turns into its opposite. This dialectical law has been strikingly vindicated by the events of the last twelve months. Let us remind ourselves that Turkey and Brazil were until recently two of the leading lights of the emerging economies. The possibility of a revolutionary upsurge in those countries did not even enter the heads of the strategists of capital. But then, neither did the possibility of the revolutionary overthrow of Mubarak in Egypt or of Ben Ali in Tunisia.
Cynics and sceptics are to be found everywhere in plentiful numbers. They are the flotsam and jetsam of the defeats of the past, prematurely aged old men and women who have lost all confidence in the working class, socialism and themselves. The professional cynics eke out a miserable existence on the fringes of the workers’ movement, and sometimes within it. Their principal aim in life is to moan and grumble about the workers and youth, to belittle their achievements and exaggerate their faults.
Such specimens are to be found above all in the ranks of the former Stalinists. Since they have long since abandoned all hope in the socialist revolution, these wretched creatures are only concerned with one thing: to disseminate their toxic brand of pessimism and scepticism among the youth, to demoralise them and discourage them from participating in the revolutionary movement.
These, people who Trotsky correctly described as gangrenous sceptics, argue that the working class is not ready for socialism, that the conditions are not ripe, etc. It goes without saying that for such individuals the conditions for socialism will never be ripe. Having established in their own minds some impossible standard of revolutionary “maturity”, they can then sit back comfortably in their armchairs and do—nothing.
It is necessary to underline the fundamental idea that the main feature of a revolution is the entry of the masses onto the stage of history. In 1938, Trotsky wrote:
“All talk to the effect that historical conditions have not yet ‘ripened’ for socialism is the product of ignorance or conscious deception. The objective prerequisites for the proletarian revolution have not only ‘ripened’; they have begun to get somewhat rotten. Without a socialist revolution, in the next historical period at that, a catastrophe threatens the whole culture of mankind. The turn is now to the proletariat, i.e., chiefly to its revolutionary vanguard. The historical crisis of mankind is reduced to the crisis of the revolutionary leadership”. (Trotsky, The Transitional Program, May-June 1938)
These lines are completely relevant to the present situation on a world scale. Indeed, they seem as though they were written only yesterday!
Against the cynics and sceptics who deny the revolutionary role of the proletariat, we will always bring to the fore the revolutionary potential of the workers and youth, which is constantly reaffirmed by events. The marvellous revolutionary movements in Turkey, Brazil and Egypt, the general strikes in Greece and Spain, the mass movement in Portugal that almost led to the overthrow of the government, the general strikes in India and Indonesia, are all clear indications that the world socialist revolution has begun.
However, the fact that a revolution has begun does not mean that it will be immediately successful. That depends on many factors, the most important of which is the quality of the leadership. Hegel wrote:
“When we want to see an oak with all its vigour of trunk, its spreading branches, and mass of foliage, we are not satisfied to be shown an acorn instead.” (Hegel, The Phenomenology of Mind, Preface).
What we have here is only the early anticipation of socialist revolution. It is the first reawakening of the masses after a long period in which the class struggle had been blunted in many countries. An athlete, after a long period of inactivity, needs time to stretch his or her limbs, to “warm up” and acquire the necessary ability to engage in more serious activities. Likewise, the working class needs time to acquire the necessary experience to raise itself to the level demanded by history.
As a general rule, the masses learn from experience. This is sometimes painful and always slow. This learning process would be rendered both quicker and less painful if there existed a powerful Marxist party with a far-sighted leadership like that of Lenin and Trotsky. If there had been the equivalent of the Bolshevik party in Egypt last June, who can doubt that the revolutionary workers and youth could have taken power easily.
Peripheral European diplomats talk darkly of a potential “crisis of democracy”, and it is a fact that the institutions of bourgeois democracy are being tested to breaking point. In the governments of Europe, above all in Berlin, there is a persistent worry that the imposition of austerity will cause social conflict on such a scale as to represent a threat to the existing social order.
The real reason why the bourgeois were so horrified by the overthrow of Morsi in Egypt, is that they fear that such things can happen in Europe. The FT has drawn an uncomfortable parallel with the revolutionary year 1848: “It [...] reminds me—of 1848. Metternich sneering out of the window at the irrelevant mob, a few hours before his unceremonious overthrow, Guizot unable to breathe with shock as he resigns his ministry, Thiers, prime minister for one day, suffering a bout of 19th Century Tourette's in his carriage, hounded by the masses…”
The bourgeois economists admit that the perspective for capitalism is of twenty years of austerity. That means two decades of heightened class struggle, with the inevitable ebbs and flows. Moments of great upsurge will be followed by periods of exhaustion, disappointment and disorientation, defeats, even of reaction. But in the present climate, every lull will only be the prelude to new and more explosive struggles. Sooner or later, in one country or another, the question of power will be posed. The question is whether, in the decisive moment, the subjective factor will be sufficiently strong to provide the necessary leadership.
Unbearable tensions are building up at all levels. The source of the general malaise in society is not only the economic factors: unemployment and falling living standards. It reflects disenchantment with all the existing institutions of capitalist society: politicians, the Church, the media, bankers, the police, the legal system etc. It is also affected by events on a world scale (Iraq, Afghanistan, Syria, etc.)
The conditions are not the same everywhere. For instance, the situation in Greece is more advanced than in Germany. But everywhere, not far beneath the surface, there is a seething discontent, a feeling that society is going badly wrong, that this is intolerable and that the existing parties and leaders do not represent us. The objective conditions for socialist revolution are either mature, or else are rapidly maturing. But the subjective factor is missing. As Trotsky said long ago, the problem is a problem of leadership.
For a whole series of objective historical reasons, the movement has been thrown back; the forces of genuine Marxism have been reduced to a small minority, isolated from the masses. That is the central problem, and the central contradiction that has to be resolved. It is necessary to recruit the necessary cadres, to train and integrate them into the organization, and orient them to the mass workers’ organizations.
This takes time. We will have some time because of the slowness of the process. But we do not have all the time in the world. It is necessary to approach the task of building the forces of Marxism with a sense of urgency, to understand that the road to big victories in the future is prepared by a series of small successes in the present. We have the necessary ideas. Our perspectives have been brilliantly confirmed by the march of events. We must now carry these ideas into the working class and the youth. The road to the workers and youth is wide open. Let us march forward with confidence.
Forward to the building of the International Marxist Tendency!
Long live the world socialist revolution!
London, 11th December.