Genes, Robots & The Internet: How Capitalism Revolutionizes The Planet

I was hoping to get to this sooner but life intervened (and technology in the form of a sick computer), along with the second Egyptian revolution, which has been riveting, inspiring, frightening. Nonetheless I wanted to complete my thoughts on the question of Marxism, capitalism and technological advancement – at least this portion of it. In the future I want to write something on Ray Kurzweil and the Singularity movement, which has accumulated a significant following, particularly amongst a section of the Silicon Valley types and the geek diaspora. Kurzweil’s ideas are often reduced to "mind uploading" as the ultimate goal (this side of the Singularity) but are actually more complex and philosophical than that and deserve a fuller treatment. But I digress. Thus far what I’ve argued has been that Marxists have too often denied the dynamism of capitalism, seeing only its propensity to crisis and have confused macroeconomic stagnation with the end of growth, progress and innovation under capitalism. They’ve also confused the fact that capitalism is obsolete – in the sense that the technological level of society is sufficient that a better, more efficient and humane economic system is possible – with the idea that it can no longer advance.
On the other hand, as I argued in my second piece on the subject, technological advancement under capitalism is systematically distorted by the need to generate profit, leading to a number of negative elements in its development and application. In fact, in retrospect, my analysis of capitalism’s failings in this regard was too focused on economic and political pressures and missed at least one other distorting factor: capitalist ideology. This requires a fuller discussion than I’m going to give it here but the basics are that the way that we organize production, with bosses, corporations, forced labour (did you have a choice about going to work this morning?), imperialism, oppression, etc. lead to a set of ideas about human nature, the natural world, etc. that serve to justify the present set-up. So, for instance, in its sociological form we are taught that humans are naturally greedy, violent, etc. In other words there is a certain notion of a fixed human nature. In its scientific form this leads to genetic reductionism: the search for the gene for crime or alcoholism or intelligence. While the failure of the Human Genome Project to deliver easy answers to the causes of inherited diseases (let alone complex behaviours) has led to a rethinking of the role of genetics. At least I believe that's the case amongst biologists who actually work with genetics, if not amongst ideological warriors of the evolutionary psychology ilk (such as Richard Dawkins). In fact, I just read an excellent overview of the history of genetics in the most recent issue of the International Socialism Journal by socialist scientist John Parrington. Definitely worth a read.
Yet, nonetheless, capitalism develops technological and even social advancement and innovation and this can’t be denied, as I’ve suggested previously. The rise of the steam engine and the development of computer tech that led to Moore’s law are just as real as the importance of electricity, which Lenin saw as an enabler of socialism. China has gone from no high-speed trains to something like 15,000 miles, more than the rest of the world combined, in about ten years. These are real advances. How is this possible? There are a number of elements that are worth exploring and have an impact on how we situate Marxism as an ideology and methodology for social transformation. In fact, I would argue that the ability of capitalism to continue to advance, in the face of all its distortions and inefficiencies, is one of the strongest arguments for socialism.
Let's start at the economic level and work "up" from there. The first place to start is in the very foundations of the system: competitive accumulation. This is the alpha and omega of the system, the drive for profit, and is expressed through both individual companies, regions, nation states, trading blocs, etc. The struggle to stay ahead has many effects upon the production process and upon society - not all of them, or even most of them, directed towards technological and social advancement. Competition creates pressure to pursue shortcuts, to externalize costs (like dumping carbon into the atmosphere for someone else to have to clean up), to lie, cheat, murder and steal. But it also has made capitalism the most dynamic system in history, pushing different sizes of capital to innovate, a fact that Marx started from in the Communist Manifesto in a lengthy discussion of the transformative power of capitalism. It is this competitive power that is behind recent innovations in robotics. America has lost a lot of manufacturing jobs to low wage districts and simply can't compete for those jobs on the basis of labour costs. Doing so would cause massive economic damage - and even short-sighted capitalists would be loathe to want to reduce the purchasing power of domestic workers as low as, say, Bangladesh. Better to invest in labour-saving capital that makes it cheaper to produce domestically given the unavoidable costs of shipping around the world. This has led to several developments in the area of advanced manufacturing. DARPA, the advanced research arm of the Pentagon has, for instance, a program for developing advanced 3D printing technologies to make custom manufacture cheap and scalable. In the private sector Rethink Robotics, one of several robotic manufacturing companies, founded by Professor Rodney Brooks (who previously founded iRobot) came out of stealth mode last October to launch Baxter an advanced industrial robot for light manufacturing that will cost USD$20,000 instead of hundreds of thousands - at minimum - and which doesn't require a team of engineers to program it, as most industrial robots do. An unskilled warehouse worker can "train" the robot to, for instance, pack widgets into boxes in about 15 minutes.
There's also a second reason why innovation and dynamism continues to be a central feature of capitalism. Even though the capitalist imperative demands that all production and innovation be for profit, ie. competitive accumulation, this is not without an in-built contradition. That contradiction, fundamental to capitalism, is between use-value and exchange-value. That is to say, capitalism produces use-values – things that we need like shoes or food – but does so for the purpose of exchange in the service of profit.  This suggests a number of things.
The first thing is that a large number of innovators are driven by use-value as well as exchange value (and sometimes exclusively by use-value only to reap exchange value as an initially unintended side-bonus). The discovery of antibiotics is an obvious one - pharmaceuticals make billions from the production (and over-use) of antibiotics. Yet its initial development was not for the purpose of generating profit - ie. its exchange value - it was to save people who were dying from bacterial infections like TB. But in a perhaps less obvious way I was also struck recently by a Google campaign to provide internet to Africa using high altitude balloons. Google is one of the largest and most profitable corporations on the planet and and yet there is a drive to provide for human need, whether in the form of autonomous cars or internet for the two-thirds of the planet that lacks this. I'm not one of those cynics that believes that even those who run corporations as large as Google are simply driven by profit as the alpha and omega. But at the same time, whether meeting a human need is sought (or generated with marketing), the ability to sell for a profit is what ultimately determines whether an innovation is developed further or not. I discussed this previously in relation to cancer research and whether a certain type of immunotherapy would be developed because it would be difficult to patent and, of course, if it cured cancer (as opposed to making it a manageable disease, which meant the continued sale of drugs), this would cut off future profits for the pharmaceuticals.
This further suggests the need for a concrete and specific analysis of the ways in which the drive to create use-values (literally useful things) is distorted by the pressure to meet the demands of exchange value (ie make a profit). Sometimes this is straightforward and obvious, particularly where industries are long-established (like petrochemical corporations that seek to retard cleaner competitors) or where it directly serves imperialism (such as the design of smart weapons). Other times it has a more indirect relationship such as with the internet, which the powers-that-be struggle to control. Particularly in the latter case a very specific and nuanced, concrete analysis is necessary to understand the ways in which exchange-value distorts use-value and thus how in a society based upon production for use, democratically determined (ie. socialism) certain technologies would be different or transformed. Literally, what would we retain and what would we dispose of. This isn’t always obvious. Lenin, famously, at the head of a new revolutionary republic insisted upon introducing Taylorism (modern factory methods) into Russian manufacturing, even in the face of severe criticism from radicals. He understood that until they could produce enough to meet the needs of their country there would be no possibility of socialism.
Lack of resources isn’t a problem that we face today (the reallocation of defence spending could solve illiteracy and hunger, for instance) and yet what we’ve forgotten is that technology is still something that we need to make a better world possible. I have a feeling that the isolation of Marxism has combined with the anti-modernism of the 1960s – the last period of significant and sustained social radicalization – to blur the vibrant modernism of earlier Marxist thought. In the defeat of the strongest elements of that period – the Black Panthers, French general strike of 1968, et al - we have taken on board the weakest aspects of that period’s critique, which is a rejection of modernity. Marxists ought to celebrate modernity’s advances without being seduced by them or forgetting that they are subservient to the imperatives of capital.
Back to the spaces that exist within capitalism that allow for advance we need to also account for a theory of agency within constraints. Marx wrote that "humans make history but not in circumstances of their own choosing." Typically Marxists apply this to the political struggle - for instance, in Egypt the people are fighting for liberation and are making history but they are doing it in the context of imperialism, Islamism, etc etc. However, this also applies to the economy and to technology. The economic manifestation of that is in the uneasy marriage of use-value and exchange-value as discussed above. It means that capitalism, while a "totalizing system", is not always a totalitarian system. In fact, it needs to leave open a managed space in which people can think and create more or less freely in order to keep capitalism vital. That space changes and is ultimately subordinate to both profit and political stability (in order to secure profit) but it rarely disappears entirely. Even in North Korea, perhaps one of the most repressive regimes at present, the system must allow for a certain amount of "innovation" at least in the field of rocketry and nuclear technology (and perhaps in means of repression as well - freedom for the purposes of repression?). And this was the logic behind Glasnost and Perestroika in the waning years of the USSR. It was an attempt to open up space for greater innovation to save the Soviet economy. Besides the governmental and economic limitations on this freedom there are also ideological (self-policing) limitations, for instance in the field of embryonic stem cells. But, again, that space always exists. However, the fact that it must be managed in order to be measured against an inefficient and parasitic "middleman", ie. profit or repressive ideology, is a demonstration not only of the fortitude of human creativity but also of the need to move beyond an inefficient system.
This also implies something else: human creativity always threatens to go beyond the artificially imposed limits of capitalism. Marxists have always understood this, again, in relation to political struggle. Ideology tells us that capitalism is the end of history, there is no better way to organize society - there is no alternative - and yet we see from the upheavals in Egypt, Turkey, Brazil, et al that workers resist the capitalist imperative to accept speed-ups, pay and benefit cuts, service cuts, etc. The same applies in the realm of technology (brilliantly discussed by Walter Benjamin pre-WWII in his essay "Art in the Age of Mechanical Reproduction"). Not only are technologies invented that are problematic for capitalism in that there is no immediate way to generate profit from them but even those that are invented with profit in mind have gaps and holes in which non-profit or anti-profit uses take hold. Again, the internet is one of these. If you've read this far you'll be aware that I'm not generating any personal profit from this activity but at a more significant level the internet constantly challenges the ability to make profit from the distribution of information - piracy of films, software and music being the most obvious example. The struggle by corporations to control the internet has been going on for at least two decades without success. The attempt by Adobe, for instance, to recently launch a cloud-based version of its expensive Creative Suite software in part as a means to circumvent piracy was hacked within one day even though they spend tens of millions on digital rights management.
At a more abstract level, this suggests a theory of historical time that is polyphonic (if that's the right term). Basically, we experience time as a singular stream of events - each day has 24 hours, each year 365 days. One thing follows another all at the same time. And yet the pace of history is not uniform. Sometimes the political developments move quickly and sometimes much more slowly, and always at different paces from country to country and even region to region. Egypt is going through a period of rapid history in which the masses and their culture are changing more quickly in months than it did previously in years, perhaps decades. The Mubarak dictatorship had lasted decades and then was gone. The Muslim Brotherhood was the only domestic opposition for even longer and they are now in disrepute and have lost the support of millions of people in the space of a year. Politics is moving much more slowly in Canada at present. But there are also other layers of society - the economy, technology, sports, film - that move at their own pace. Even as they are related, of course, they have their own relative autonomy (as the old Marxist phrase goes). Technology can also develop more quickly than, say, political consciousness. We see some of this, for instance, in the rapid dominance of Chinese manufacturing in significant sectors of the North American economy, without, for a long period, the impact of this being felt in terms of political and cultural developments. All of which is to say that history has many streams that exist side-by-side, that pour into each other and then separate again or, perhaps more accurately, history moves in a way similar to fluid dynamics, involving multiple vectors and velocities within the same space. To understand history - in order to change it - we must be able to understand at each moment how these different streams interact with each other.
How does this effect Marxist propaganda? Of course the primary role of any radically oppositional ideology will be to expose the failures and weaknesses of the system. But we ought not to highlight the succeses of the system and attempt to pretend that they are failures. For instance, the generally brilliant writing of Hilary and Stephen Rose has dismissed the Human Genome Project and genomics more generally as a failure. And yet, as John Parrington points out in his article, while the naive expectations in the flush of success were unfounded, the HGP has revolutionized the field of gene research. It's also true that genomics and synthetic biology are serving industrial needs in ways that are potentially dangerous and, especially in agricutlure, really about forcing farmers to buy seeds of dubious value. But it is not the case that those sciences are in and of themselves a failure and have provided no advances. Recent work in regenerative medicine, stem cells and gene therapy (including work on improving results in heart failure recovery, fighting autoimmune diseases, HIV, Muscular Dystrophy, etc) has advanced enormously in part as a result of the insights gained by the HGP and the more recent work on epigenetics that was the focus of the ENCODE project. The problem, that this suggests, is not that capitalism doesn't provide revolutionary advances in science, technology and production. It is that it does so in a way that is inconsistent, contradictory, inhumane and often just downright destructive. To take full advantage of the gains that capitalism has wrought we need a system whose sole purpose is the satisfaction of human needs, not as an occasional and secondary by-product of profit-making.

SEE ALSO PARTS ONE & TWO IN THIS SERIES:

1) Marxism, Capitalism & Technology

2) Frankenfoods, Toothpaste, & Justin Bieber: Capitalism & Technology II

Frankenfoods, Toothpaste, & Justin Bieber: Capitalism & Technology II

In a previous post I argued that too often Marxists fail to recognize the ways in which capitalism remains dynamic and continues to advance technologically and socially. This one-sidedness distorts analyses and perspectives and threatens to give Marxism the feel of a millennial doomsday sect. Instead Marxism ought to be perceived as a powerful critical tool for explaining the contradictions of capitalism and providing strategic answers to create a better world without them. To do so means that Marxism must be flexible and dynamic. It must not fear the strengths of capitalism but rather must build itself on the ways that capitalism has made a better, more efficient and humane system both possible and necessary. That failure is a result of an ideological defensiveness and ossification arising from the isolation of Marxists from workers struggle (at least in the English-speaking world) for longer than a generation. I want to now posit some thoughts on the way that technological development takes place under capitalism, how it is distorted by the profit-motive and by the prerogatives of the capitalist state – and yet still manages to create forms of progress that are often quite dramatic.

To summarize what I previously argued, billions of people now have access to the internet (though two-thirds still do not). China and a number of other “developing nations” are growing at a rate unprecedented in modern times, at least in terms of scale. China has plans, for instance, to urbanize an additional 500 million people over the next decade or so. Private companies, most notably SpaceX, are bringing down the cost of space travel (potentially by a hundred-fold if they manage to establish reusable rocket components) or, in the case of Planetary Resources, developing business plans to mine asteroids. Regenerative medicine is working on the development of 3D printing of organs, regrowing lost teeth and even reversing male pattern baldness. Gene therapy, long shunned after some earlier false starts, is moving a number of therapies for MD, AIDS, hemophilia, blindness and even the common cold, through clinical trials. Moore’s Law has advanced computing to the point that supercomputers from the 1970s that were housed in entire buildings are now contained in a smartphone that can be bought for under $500. The world has never seemed to change as quickly in human history as it is today.

And yet there are serious problems and great dangers that face humanity from hunger, diabesity (diabetes and obesity) and poverty to war and climate change. Ice caps are melting, the economy is stagnating (though with recent signs of life in the USA) and we face challenges never before faced. How is this possible? It is fundamentally rooted in the contradictions of the way that capitalism organizes the economy, research and more. I want to argue that the problems are rooted in at least six ways that capitalism distorts research and technological development. These are as follows:

1) Capitalism only develops technologies that can generate profit, and usually only those that can generate short-term profit. This has a few results:

a. Capitalism produces technologies that we don’t need. We don’t need a new smartphone every year or a new flat screen TV or remote controlled lawn mower. More than anything capitalism uses advertising and marketing to get us to buy dumb shit. This is rooted in part in alienation from our own productive capabilities as human beings. Because our labour is forced we seek reward in consumption, literally in buying things or in our animal desires – eating, sex, etc. – rather than in what makes us human, our ability to labour (ie. Transform nature) because that ability is taken from us by forced labour (work for someone else or starve).

b. Capitalism doesn’t develop technologies that we do need. If it doesn’t produce an obvious profit, technologies are neglected. 

c. Capitalism produces stuff that is simply garbage and doesn't work but which continues to be produced because it generates profits. Think of GMOs, these are very big business. Yet, many recent studies suggest that they don't do what they say - increase crop yields. (There are also many potential dangers in relation to human consumption, et al). But GMOs have the benefit, from the point of view of capitalists, of allowing agribusinesses to dominate the agricultural production because they can patent the seeds and thereby outlaw their "illegal use" such as seed banking (which would permit farmers to avoid having to buy more seed and fertilizer every year. It also allows the corporation to generate sales of ancillary products like fertilizer and pesticide, since their seeds are designed to be used in conjunction with their specific products. Again, with no clear, uncontested evidence of the seeds being useful for producing more of anything except profit.

2) Related to that last point, capitalism is only interested in technologies that it can enclose using legal measures like copyright, patents, etc. We are all aware of the music and film industries and their struggles to stop “piracy” (much of which is actually just freely sharing, involving no money or profit) but this extends to many fields, including the recent decision by the US Supreme Court to negate the right of companies to patent naturally existing genes (as opposed to synthetic genes, such as with GMOs). While it's good that companies can't go so far as patenting, in this instance, the genes that lead to higher breast cancer risk, in the years to come patented synthetic genes will become an obstacle to research and meeting human need - just as patented pharmaceuticals have contributed to tens of thousands of deaths from AIDS in Africa, where people and governments couldn't afford the exorbitant prices.

3) Capitalism produces technological developments that achieve false, rather than true, efficiencies by externalizing as many costs as possible – on the environment, onto workers, etc. The most obvious one here is fossil fuels. There has been talk for decades, for instance, as to when solar power will achieve the same cost as coal, natural gas, oil, etc. But if we account for the future cost of cleaning the environment; the cost of extreme weather events and the melting of the polar ice caps; the cost of healthcare for children with asthma, the cost to the deterioration of buildings in cities, etc. – this point was probably already reached a while ago. The inefficiencies are hidden and offloaded to the general population. At a more "mundane" level, the recent deaths of over a thousand garment workers in Bangladesh is a stark demonstration of exactly what it means to "externalize costs" onto workers.

4) The technologies that capitalism invents that could make life better – for instance robotics and other forms of automation, etc. – instead cause dislocation through unemployment and provides a downward pressure on wages through deskilling, offshoring, etc. This is pretty straightforward – the rise of the internet has made international trade more possible, permitting the off-shoring of jobs, from low-skilled manufacturing to service jobs. Websites like designcrowd.com and Elance.com allow the hiring of freelancers in the developing world for half or less the cost of paying for those services in the first world. Foxconn, which produces the iPhone and many other high-tech items announced a plan in 2011 to utilize three million robots within a few years. This will come at the expense of jobs in China.

5) Capitalism attempts to use technology to solve problems that are created by social conditions, not lack of technology.

a. An obesity pill is a really obvious human health issue. Obesity is caused by the rise of processed foods that lack nutrition but which are craved by time and cash-strapped working families.

b. Greater crop yields – Monsanto and other companies seek to patent genetically modified crops (related to the above point about enclosing tech and bogus technology) but the problem is not production it is that people can’t afford food. There is no food shortage, there is a shortage of “effective demand” – people who can afford to buy the food.

6) Of those technologies that capitalism is interested in that don’t have immediately apparent profit opportunities, the only ones that usually get developed have benefits for the state, usually in the form of its military arm.

a. Drones – these have become widespread, first for foreign military purposes (literally to bomb people in the Middle East and places like Afghanistan). They are now being utilized by police and security services as a way to perform surveillance on domestic populations.

b. Even in healthcare, the areas that get funded are in large part that have a military component, like treating soldier’s who suffer major trauma.

These are, of course, only a small sample of technologies and technological dynamics that are distorted by capitalist dynamics. I may well have missed some and invite other to add to this list. But it nonetheless suggests that capitalism is both inefficient and destructive in the ways that it develops technology.


SEE ALSO PARTS ONE & THREE IN THIS SERIES:

1) Marxism, Capitalism & Technology

2) Genes, Robots & The Internet: How Capitalism Revolutionizes The Planet

Marxism, Capitalism & Technology

Thoughts on Marxism & Technology Part I There is a joke about Marxist economists that goes something along the lines of “Marxists have predicted five of the last four recessions”. I was reminded of this joke recently as I debated with a comrade about capitalism and progress, specifically around technological advances in modern capitalism. I suppose that for Marxists, as radical critics of the present system that we will tend towards always pointing out the weaknesses and contradictions of the system; the way in which it develops technology – the means of production – in a distorted way that leads to economic, environmental and humanitarian crises. These critiques are important tools for puncturing the arrogance and pretensions of the present system and pointing to a better, less destructive way, to organize society.

And, yet, there is a danger that we look like Luddites or moaners, scoffing at everything and seeing no good in anything, perhaps not to each other – we expect “ruthless criticism of everything that exists” - but certainly to most working class people. I remember this well in the 1990s as the internet was expanding rapidly and changing the way that we communicate, access information, etc. Of course, it wasn’t only us who were grappling with this. I was in university at the time and there were debates about how to treat internet-based research for papers – was it an academically valid resource; how ought it to be footnoted in papers, etc? But our own reaction to the internet, and now web 2.0, looks quaint to say the least. We have had two reactions, which typify in general the reaction of contemporary Marxists to technology. These are 1) deny its significance (“only middle class people use the internet”, “it hasn’t changed anything about how we organize or communicate”) and 2) emphasize its destructive aspects (British Marxist Alex Callinicos recently referred to the “dark side” of the internet, leading to much chuckling).

The real problem, of course, lies not with the failure of capitalism to innovate and transform the lives of people, not only in the developing world (to which I’ll return) but also those in the developed world. Of course this transformation includes a serious destructive element – the rise of smartphones has led to proxy wars and trade maneuvers towards securing and manipulating rare earth metals that are key elements in smartphone manufacture, for instance. In terms of the economy, the irresistible pressure of Moore’s Law, which describes the tendency for the number of transistors on chips to double every 18 months or so, has not only given us the aforementioned smartphones, it has also led to the deskilling of a whole number of fields, technologically-driven unemployment, etc. Not to mention the destructiveness of mining practices, etc.

But there is also a progressive side to this development. It is a good thing that we can access information instantaneously. I am someone who works from home for a company in another province. In the course of a given day I receive material in pdf format via e-mail. I input my expenses into an online bookkeeping website that calculates and itemizes all of my expenses and income for me (for free). I pay my bills online and send money electronically, which saves me hours of standing in line at the bank. I purchase or sell second hand products from another country and have them shipped to my home. I pay another freelancer to design a poster or do research for which I’m ill-equipped. This list doesn’t even touch on social media. As I write this I’m involved in a crowd-funding campaign for a movie that I co-directed that has raised several thousand dollars. A lot of that money has come from people I haven’t personally seen for a decade or more but with whom I maintain a semblance of contact through Facebook. I’m not that old but when I was in public school there weren’t even personal computers and our introduction to computing was filling in punch cards using binary language to perform simple math problems. We sent off the cards to be processed and they returned a week later. To say that advances in computers have transformed our culture – even if it hasn’t eliminated capitalism, is stating the obvious.

On a society-wide scale the transformation of China is nothing short of breath-taking. A generation ago the vast majority of Chinese lived in the countryside without phones and TVs and were illiterate. China is now an urban nation with 100 times more cities above 1 million people than the US, with income in the top 50% of the planet, and with literacy around 95%. As a result of innovation the Chinese company that manufactures Apple’s iPhones and the Kindle, with a workforce of about 500,000 in China alone, is moving towards adding up to 3 million robots to its manufacturing process. The Broad Group, originally a manufacturer of air conditioning units, will break ground next month on what will be the world’s tallest building using factory fabrication techniques. The 838 metre building will be erected in about six months – compared to six years for the current record holder, the Burj Khalifa. Of course there are problems – China is a dictatorship; the major cities of China are rife with corruption, pollution and smog, gridlock, etc. These are not insignificant but to deny that capitalism has transformed China is to deny reality.

The same exploration of technological advancements could be applied to multiple fields. In many ways, in my opinion, we are in the midst of a new industrial revolution that brings together a conjuncture of materials science, computing power, biology, robotics, space technology, in a way that is transforming our society. This combines with the effects of post-colonialism in significant areas of the world – belated and problematic as that is. The penetration of China into Africa, where the previous relationships were almost purely about capital outflows, is transforming that continent as well. Just as the industrial revolution didn’t eliminate exploitation, neither do present advances, but it is nonetheless transforming our world.

Is there a crisis gripping capitalism internationally? No doubt about it. Greece has been in meltdown for half a decade. Spain is not much better with close to 50% unemployment for youth. Japan has had a decade of deflation. The list goes on. But without revolutions to resolve these crises it is certain that capitalism will itself solve them – through destructive and inhumane means, to be sure. But if capitalism could survive the Great Depression (with a world war that cost tens of million of lives) it can survive the present stagnation. There are whole swathes of the world from Africa to Latin America to Asia that are still in the early stages of development and can provide an outlet for the system. War and imperialism provide another mechanism.

What about the environmental crisis? The problem of carbon emissions and climate change is absolutely devastating. Severe weather patterns will become more and more the norm, particularly in regions where this was already the pattern – hurricanes, monsoons, tornadoes and more. This is radicalizing millions of people and making them open to the argument that this system is fundamentally destructive. But we ought to take a lesson from the ozone crisis of the 80s and 90s, which was then considered to be the looming apocalypse. It didn’t materialize and capitalism was able to reduce the use of CFCs to the point that the ozone layer is no longer depleting and the ozone hole has shrunk. Of course carbon-based fuels are much more central to the economy than CFCs but we shouldn’t kid ourselves that capitalism is structurally incapable of overcoming its dependence upon fossil fuels. The growth of renewables and nuclear forms of energy are proceeding at rates sometimes five times the rate of growth of the global economy. They are still a small component of the overall mix of energy sources but capitalism, with the aid of the state, can shift quickly where necessary. Of course these are problematic, particularly nuclear power (though research into deep burn fission may well resolve the problem of nuclear waste). However, in China where energy use is growing most rapidly (in the US carbon emissions have actually declined since the onset of recession in 2008) there is a concerted effort, for national security reasons and because of smog in the cities, to both increase energy efficiency and to move away from dirty coal and to increase renewables in a significant way. Will it be enough? Hard to say but it might be and, while arguing against capitalism’s dependence on fossil fuels we ought to be prepared for the distinct possibility of moving towards significant carbon reduction and even carbon neutrality. The only thing that capitalism absolutely needs is profits, everything else is more or less contingent.

We can take a lesson from Marx when it comes to how we view capitalism. In the Communist Manifesto, written more than 150 years ago, Marx begins by praising the power of capitalism to transform the planet. That power is no less diminished today than it was in Marx’s time. If anything it has increased exponentially. The belief that the dynamic period of capitalist development has passed is a myth. China’s rise – and the imminent rise of Africa and Latin America - ought to be proof enough of this. Of course it is true, more than ever, to say that capitalism is obsolete but that is not the same thing. Capitalism is obsolete because capitalism itself has made other ways of organizing the system both possible and necessary to end the ongoing destruction of our planet and the brutal exploitation of humans. But it is not the same to say that capitalism no longer is dynamic and no longer produces advances that will aid a future society in which profit and imperialism are no longer the driving force for advancement.

The real challenge for Marxism is not the continued existence of capitalist dynamism and development. The real problem is that Marxism as a living, mass movement has been isolated for generations. The impact of Stalinism followed by the decline of the movements of the 1960s and 1970s has led to an ideology of retrenchment. We have lost confidence and that has made us defensive, which has had an impact on Marxism at both the level of organization, leading to bureaucratic and brittle methods, and at the level of theory. Lenin, at the head of a victorious revolution could declare that communism equaled Soviet power (basically a new model of democracy organized through workplaces) plus electricity. Imagine declaring anything similar today viz the internet or biotechnology or robotics. We now fear anything that seems to undermine the millennial dreams of Marxism, such as the continuing power of capitalism to transform millions of lives. The idea that capitalism could still progress suggests falsely that our goals are obsolete, rather than giving us confidence that the advances of capitalism make the possibility of socialism more palpable. We need to return to Marx in engaging critically with the technological advances that are coming fast and furious. We shouldn’t pretend that genomics is irrelevant or the equivalent of phrenology, the 19th century quack science of measuring skull bumps to determine criminality, for instance. Pointing to genetic reductionism – the idea that there is a gay gene or a gene for criminality or even one gene responsible for most diseases – is to shadow box with arguments from ten or fifteen years ago. The arguments and those methods have largely moved on as a result of experience. This is not to say that there aren’t still problems with genomics and the field of genetics more broadly. From GMOs to genetically modified algae that produce diesel, to medical treatments, genomics often seeks to treat problems whose origin lies elsewhere, in socially created problems that arise from capitalism itself. Nonetheless, we should see the revolutionary potential that these advances hold if they are harnessed towards human ends, rather than those of profit. We should celebrate their liberatory potential while resisting their capitalist implementation that serves profit or imperialism at the expense of humans.

This is not simply of academic importance. It effects the work of Marxists in two ways. On the one hand it is important in terms of relating to working class people’s experience and not coming across as a cult that denies that the world is round. When growing numbers of people with cancer have more effective treatments because the genome of their tumours can be analyzed to prescribe the most effective medication we look foolish to say that genomics is irrelevant – as opposed to pointing to the role of environmental and dietary pressures that lead to higher rates of cancer, or the fact that most people lack access to these treatment options. And, on the other hand, denying reality distorts our analysis and perspectives, which shapes how we act and organize to change the world. If we are “predicting five of the last four recessions” it speaks, in a humorous way, to a weakness in our approach: a desire for capitalist catastrophe to prove our theory correct, rather than a desire for popular mobilization to prove our theory correct. The irony is that we don’t need catastrophism to demonstrate the power of Marxism. We don’t need to fear scientific advance and the dynamism of capitalism as a threat to our ideology. The dynamism of capitalism is creating an ever-larger working class whose interest remains the overthrow of their exploiters. The rulers of China are scared more than anything by the rebellion of their population – who resist far more militantly and regularly than the North American working class. And the scientific advances demonstrate that capitalist authoritarianism and private property are hindrances to realizing the full potential of those advances, and that the democratization of science is the only means to avoid the destructive application of those advances.

SEE ALSO PARTS TWO & THREE IN THIS SERIES:

1) Frankenfoods, Toothpaste, & Justin Bieber: Capitalism & Technology II

2) Genes, Robots & The Internet: How Capitalism Revolutionizes The Planet

Syrian Revolution: Caught Between Repression & Imperialism

The first and foremost thing that must be said is that the people of Syria, who have resisted an utterly vicious military repression of their aspirations for nearly a year, are some of the bravest people on the planet. Day after day the government of the Assad dynasty find new levels of depravity in their attempt to brutalize and torture the democratic aspirations of their population into submission. We are witnessing both the heights and the depths to which human nature can sink.

For that reason I have absolutely no sympathy with those who attempt to excuse the actions of the regime on the grounds of supposed anti-imperialism. This is a vicious and bloody police state that is fighting for its life, not some progressive bastion - any more than was Libya - it deserves to have no tears shed for it.

That doesn't imply, however, that it isn't a complex situation. Sadly, the Syrian regime is not the only vicious and anti-democratic regime in the world. The United States comes to mind. After all, they arm the thoroughly backward, religiously justified police state of the Saudi  monarchy. They benefit from the sectarian and repressive Bahraini monarchy next door. They have financed the Egyptian military's repressive apparatus since the 1970s. And that doesn't even include the millions of people whose deaths can be directly and indirectly laid at the feet of the US government (that's right, I wrote millions - Iraq, Indonesia in 1965, El Salvador, Chile, the Philippines, et al). And a number of equally (or more) vicious, anti-democratic regimes have their fingers in the Syrian pie in a way that is no so very different from Libya.

As I've noted more than once, the Arab revolutions in the first instance threw the USA and its allies in Europe and the Middle East, on the back foot. Their core clients were thrown onto the backfoot and for a moment it looked like the USA would even lose Bahrain, home to the extremely strategic 5th Fleet. But counter-revolution, like rust, never sleeps and, as Mao said, in crisis there is opportunity. With the uprising in Libya, the Americans, Europeans and the Gulf Cooperation Council - which composes Saudi Arabia, Yemen, Bahrain, Oman, UAE, Qatar, and Kuwait and was fresh from crushing the pro-democracy movement in Bahrain - moved to intervene in the Arab revolution. The idea was clearly two or threefold. 1) Steer the revolution in a "moderate", pro-capitalist and pro-western (cough, cough, Israel) direction. 2) Eliminate regimes that were not fully in the pocket of the Americans and the Saudis/GCC. And 3) do some damage to the ambitions and strategic interests of other imperialist powers, in particular China and Russia.

Libya may have been the first stop on this traveling road show but it most certainly isn't the last. And now Syria is becoming the next target and battleground for inter-imperialist rivalry. This is, of course, very dangerous for the region and the Syrian people. None of the big players give a damn about democracy or self-determination. The Russians spent more than a decade slaughtering Chechens who were foolish enough to think that they deserved independence because it's a democratic right - not to mention the Russian government's penchant for internal repression and fixing elections. The Chinese? Tiananmen Square, anyone? Actually, China makes no pretence about having any support for democratic rights - the Chinese people "aren't ready" for democracy. Turkey has, of course, also made noises of support for the anti-Assad movement in Syria but their concerns for democracy can't be taken seriously either, with their continued denial of the rights of their Kurdish population, including a recent deadly bombing raid on Kurd civilians - and a counter-insurgency in the 90s that destroyed something like 40,000 villages.

The involvement of these opposing players with their regional ambitions - I haven't even discussed Iran, which remains in the crosshairs of the west - is making the struggle for democracy more difficult. It is making it more, not less, likely that Syria will descend into civil war. For those of us who live in the Europe and North America, our first responsibility is to oppose all attempts by our governments to intervene in the Syrian conflict. They are not here or anywhere interested in the human and democratic rights of the population.

Within Syria itself the scene on the ground is very complicated. There is much talk in the press about divisions within the opposition but how much that is reflected on the ground inside Syria is unclear and how much of it is a cynical attempt to get the more radical and grassroots Local Coordination Committees to line-up with the pro-imperialist, emigre-based Syrian National Council (SNC) is unclear. The existence of the Free Syrian Army (FSA) also further complicates matters. On the one hand its existence is a positive sign of the disintegration of the Syrian state's repressive apparatus. On the other it risks becoming a substitute for a mass movement and causing a descent into civil war, which will be much more convenient for the imperialists of each side to back. It doesn't help that the FSA leadership has itself lined up with the SNC. Like in Libya, the FSA could easily end up acting as the foot soldiers for a NATO military operation.

At present the movement seems to have, against tremendous odds, retained its mass, popular character with strikes, sit-ins and other forms of civil disobedience and popular mobilization. It is, in many ways, now a game of wills - who can withstand the pressure exerted by the other longer. The Syrian state is a "deep state", which, like many other dictatorships in the region, has utilized clientelism, sectarianism, tribal and ethnic rivalries to sustain its power base. Undermining those deeply embedded relations of clientelism and fear was never going to happen overnight and was unlikely to ever happen without bloodshed, given the vicious nature of the regime. But the momentum seems to be in the direction of the disintegration of the Syrian regime, as the movement has now firmly taken hold in the capital, Damascus. What the movement needs most at the moment, it seems, is time to finish the job free of the meddling of outside interlocutors whose interests are anything but democracy and justice.

Did NATO's Libyan "Liberation" Blow-Up In Their Faces

During NATO's bombing campaign to dominate and destroy the Libyan revolution liberate Libya last year, I wrote that their real interests lie with intervening into the Arab Spring in such a way as to bend it towards European and American ends. The other driving motivation behind the intervention was to counter China's growing hegemony on the African continent.

For a number of years China has quietly been increasing its capital investments and trade relationships with a number of African countries. From the point of view of the African governments - more or less democratic or repressive - China's involvement has been more heartily welcome than that of Europe and North America for the simple reason that China's money, etc. comes with no (apparent) strings. No doubt this is a product of two factors. The first is that European and North American governmental policies with regards to Africa are based upon a set of vile racist and colonialist assumptions about Africa. And going along with that is a never-ending jogging for influence via proxy armies and direct interventions.

Secondly, China is the new kid on the block, or the new store on the block. And they have learned from lengthy experience that the way to break into new markets is by offering better deals than the old stores. This is the oldest trick in the export market book. Think way back to Japan's Honda cars, which were basically disposable, cheap cars way back in the 1970s. Now they are semi-luxury sedans. Ditto Hyundai from the South Koreans. And, of course, with China you can say that about everything they make. From dollar store trinkets and laughably constructed toys for kids they are now the manufacturer of choice for every high tech company in the west from Apple to HP to IBM (who sold off their PC division to China, which renamed it Lenovo and made it massively successful - oops!).

Now, transpose that method into one that is geared towards the developing world and building the influence of China as a nation that needs major raw material inputs. You begin to see their method and its success. It also makes clear the real reason why China (along with Russia) is so opposed to Syria becoming another Libya. It has nothing whatsoever to do with national self-determination and opposition to imperialism - any more than western hand-wringing and sanctions has anything to do with concern for human rights or democracy. If you don't believe me about the latter, I will only point out that the US gives $1.3 billion to the Egyptian army every year specifically to finance the security services - never mind the money and weapons that are sold or given to every dictatorship in the region. As for China's interest in self-determination - Tibet and Xinjiang provide clear and bloody refutation of any delusions in that direction.

All of that is background to the fact that NATO's intentions in Libya seem to be blowing up in their faces - a reminder that besides death and misery, the thing that war produces most of is irony. Within Libya itself, the prospective client regime is having its own difficulties living up to the hopes of NATO. Not only are elements of Gaddafi's former supporters giving it military troubles - witness the recent recapture of Bani Walid by a pro-Gaddafi militia - but even in the TNC stronghold of Benghazi there have been violent protests against the new bosses.

In the rest of Africa the knock-on effect of NATO's forceful intervention in the Libyan conflict has not been to make Africa more compliant and open to western demands. Rather, it has pushed African governments deeper into China's embrace, as evidenced by the keynote delivered at this past week's African Union summit delivered by a senior Chinese diplomat in the new AU HQ that was built with Chinese money and with the announcement that China would step into the financing void left by Gaddafi's overthrow. While this irony has a certain deliciousness to it, it also has serious and potentially bloody dangers. Europe - with its old world sense of aristocratic entitlement - and the USA - with its belligerent, cowboyish sense of entitlement - are unlikely to let the matter lie. What is more likely is that the immediate future of Africa will see an intensifications of covert and over interventions to try to regain hegemony. That, of course, is a recipe for further instability and war in Africa and greater inter-imperialist rivalry more generally.

African Union embraces generous Chinese financing - The Globe and Mail:

'via Blog this'

Steve Jobs' Biggest Success: Sweatshops & Fat Salaries

The other day I mused on the simultaneous outpourings of sadness and loss over Jack Layton & Steve Jobs and what each of them represented. As I noted at the time I am a Mac Head and a bit of a technophile/gadgetphile. Having had a few days to think about what I wrote I've decided that I was too soft on Mr. Jobs. My eyes were filled with iPhones - perhaps it's my anxious wait for the new iPhone 5/4S coming in the next few weeks - and I felt a twinge of betrayal as I typed up my blog post on a Macbook Pro. But I've broken free of Steve's evil spell and I think it's important to set the record straight.

Steve Jobs real advance was not in creating great products. Of course he realized that for Apple to survive meant leveraging cutting edge tech that was nonetheless ready for the consumer market. He hired Jonathon Ive to design stuff that looked sexy and Steve thought outside of the box when it came to things like ways to transmit audio and, ultimately, video. The creation of the smartphone was, perhaps, his biggest masterstroke and a game-changer.

All that is true but the man who to whom Steve Jobs handed the throne at Apple wasn't Jonathon Ive the innovative designer, it was Tim Cook the Chief Operating Officer. Cook's claim to fame is not technological innovation or having a finger on the pulse of the American (world?) consumer. Rather, he is the man credited with cranking up Apple's bottom line by neo-liberalizing the hell out of the company - getting Apple out of manufacturing and outsourcing everything that wasn't nailed down, particularly to Asia and other low wage economies. Of course, that shouldn't surprise us, Cook is also on the board at Nike, another notorious sweatshop company. He is, in other words, a hatchet man. So much for all that hippie love and Levi's jeans wearing regular guy shit that Apple was supposed to represent. In this sense, Apple really led the way in decimating the American tech industry and putting manufacturing into the hands of workers living in repressive low wage regions like China where trying to form an independent union can get you some serious jail time. According to this article in Working In These Times:

According to former Intel CEO Andy Grove, in the 1970s there were about 150,000 Americans working in the computer industry. Between the 1970s and now, the computer industry economic footprint grew from being a $20 billion a year industry to $200 billion a year. At the peak of U.S. employment in the computer industry, there were two million people employed in making computers in the United States.
Now, with most computer manufacturing being done overseas, there are only 150,000 Americans employed in the computer industry, according to Grove, who wants to reverse the trend.

In These Times is, frankly, a bit obsessed with moving tech jobs back to the USA, as though that is a solution. Workers in the USA have also suffered declines in real wages over the past two generations. In fact, if the issue were social justice, Chinese workers could rightly point to the fact that their incomes have doubled or trebled in the same time period and wildcat strikes have not only been more widespread than in the USA, they have won bigger wage gains. "Buy American" is simply not a viable solution for the problem of neo-liberal wage and benefit cuts. However, it is certainly the case that while wage rises have been significant in China in the past 20 years, wages remain low and conditions are still often appalling as an investigation by the UK Daily Mail discovered:

Yet, amid all the fanfare and celebrations this week (for the release of the iPhone 4 when the article was written), there was one sour, niggling note: reports of a spate of suicides at a secretive Chinese complex where Jobs's iPhone, iPod and iPad - Apple's new state-of-the-art slimline computer - are built and assembled.
With 11 workers taking their lives in sinister circumstances, Jobs acted swiftly to quell a potential public relations disaster.
Stressing that he found the deaths 'troubling' and that he was 'all over it', the billionaire brushed aside suggestions that the factory was a sweatshop.
'You go in this place and it's a factory but, my gosh, they've got restaurants and movie theatres and hospitals and swimming pools,' he said. 'For a factory, it's pretty nice.'
His definition of 'nice' is questionable and likely to have his American workers in uproar if such conditions were imposed upon them.
Foxconn employs 420,000 workers at its Shenzhen plant where conditions are very basic with no air-conditioning
For, as Apple's leader was taking a bow on the world stage, the Mail was under cover inside this Chinese complex. And we encountered a strange, disturbing world where new recruits are drilled along military lines, ordered to stand for the company song and kept in barracks like battery hens - all for little more than £20 a week.

But while the workers who make Apple products lack the right to form independent unions and make less than $40 a week, not so Tim Cook who helped create the sweatshop. According to Forbes Magazine, Tim Cook received total compensation of $59 million in 2010. No, you didn't read that wrong - fifty-nine million dollars. As a reward for his new role as the CEO of Apple, Cook was given a little gift: 100,000 shares in Apple. At its present value those shares are worth $383 million. Just to put that in perspective, last year Tim Cook was paid the same amount as 28,365 workers at Foxconn who made the iPhone, iPad, etc etc. And that, really, sums up Steve Jobs' greatest hit.

China & Canada: It Was Never About Human Rights

There's much foofaraw in the media about the visit by Foreign Affairs Minister John Baird to China. Are we now neglecting human rights in the interests of profit? Have we stopped supporting liberation struggles, like those of Tibet? NDP Foreign Affairs critic Paul Dewar suggested that the Tories lacked "coherence" in their policy, focusing now on profit whereas before it was all human rights. He raised the "constructive engagement" of Richard Nixon as a model. Nixon?!

Well, I think there's a third axis of consideration that the polarity of profit vs human rights fails to take into account that has everything to do with geopolitical considerations that can't be simply reduced to profit.

First off, let's not kid ourselves, human rights have never been of any real consideration when it comes to Canadian trade or foreign policy. We have a free trade agreement with Israel - even as it builds illegal settlements and kills civilians with the same routine effort as a someone mowing their lawn. We traded with Chile during the Pinochet dictatorship. Likewise with the brutal dictatorship of Suharto in Indonesia. We supported the overthrow of the elected government of Aristide in Haiti and help to enforce the suppression of Lavalas, the most popular political party in the country - for what crimes I'm not sure (I guess the crime of not being sufficiently subordinate). We backed Mubarak in Egypt and the Saudi monarchy that won't allow women to drive and kills people with beheading. Hell, until three months ago we were trading and investing with Gaddafi in Libya.

No, human rights has nothing to do with it. It is merely a convenient fig leaf to cover other intentions. After all, who can say no to human rights? And, it's true, in places like China human rights are suppressed in regular and brutal ways. So, there is the ring of truth to such claims. But, as usual, the biggest lies are always dressed up in the brightest colours of truth to hide the ugliness of what's really going on.

Afghanistan is a fine example of this. The official line is that we're there to aid in democracy, defend the rights of women, human rights, development, etc. etc. Yet this doesn't square with our actual policy on the ground, which involves propping up and funding warlords and drug dealers who think human rights means the right of some humans (them) to kill, rape, and rip-off other humans. As was clear from the revelations regarding Canada's cover-up of routine torture of suspects, we happily went along with that conception. But it would also be wrong to think that there is some kind of one to one relationship between what we're doing in Afghanistan and some immediate financial interest. It would be more immediately profitable to run the gas and oil lines from Kazachstan through Iran, which already has pipe infrastructure - but Iran is an "enemy" and so, instead, extra money must be spent to run it through Afghanistan then Pakistan. It's also about "containing" China, which is a neighbour on the other side of Afghanistan. Afghanistan is thus of strategic interest.

Our relationship with China is not dissimilar and reflected our synchrony with US foreign policy on this issue. US pressures on China are about jockeying and geopolitics. It's about the US reminding China who is the boss in subtle ways - and that the relationship between the two countries is not that the US couldn't do without. What has shifted for Canada is the growth in Canadian trade with China, which is sucking up softwood lumber at a ferocious pace. Softwood lumber exports to China are now greater than such exports to the US. China has also become a significant investor in Alberta oil and gas production, as well as mining and smelting. And with the decline in the US dollar relative to the Canadian dollar, our trade with the US has been harmed. After years of running significant trade surpluses, Canada began to run trade deficits starting in 2009. As a trading nation there is pressure to find more markets - and if the US can't be that market, Canadian manufacturers and resource companies need to find one elsewhere. The decline in US/Canada trade reduces the incentive to follow US foreign policy quite so closely, which is why Obama met last week with the Dalai Lama and Harper & Baird didn't mention Tibet once. This shift is, in general, part of the shift to a less stable, multi-polar world. Harper's obsession with Arctic sovereignty and the increase to military spending are also part of this. While the US remains - and likely will for sometime - the pre-eminent world power, with military spending at levels that dwarf any other power, it nonetheless faces challengers, for instance China's move into Africa. It can't simply be assumed that hitching your wagon to the Yanks will get you what you need. Canadian imperialism wants to have a little more freedom of action. Baird's visit and honey-coated words for the Canada/Chinese relationship is part of that. It is just as cynical and corrupt as was our previous relationship.

Calling China an ‘important ally,’ Baird turns cold shoulder to fugitive - The Globe and Mail

Libyan Rebels Are NATO Patsies For A New Great Game In Africa

Today: UK PM Cameron with Mustafa Abdul Jalil,
head of rebel TNC & former Gaddafi Justice Minister

In the first days following the pro-democracy demonstrations and then uprising in Libya, it would have taken a hard heart indeed to not support the revolt. While Muammar Gaddafi might once, in distant memory, have been able to claim some sort of fidelity to anti-imperialism and to the social development of Libya, those days were long gone. His regime was now taking money from Europe to act as its southern gendarme against illegal African immigration to Europe and was an enthusiastic partner in the War on Terror. It's no accident that arch-war monger, former British PM Tony Blair, was announced by Gaddafi's son to be a $1 million+ per year consultant to the regime. The domestic economic policies of the regime were increasingly neo-liberal and his son - and likely heir to the leadership of Libya - Saif al-Islam was the Libyan version of Gamal Mubarak - a designer suit wearing playboy and enthusiastic privatizer. The Libya regime was now just one more western supported petro-dictatorship in the Arab world.

What's more, that revolt was obviously part of the wave of revolts sweeping the Arab world and that had already toppled Ben Ali in Tunisia and Mubarak in Egypt. In Bahrain it looked like the pro-democracy movement was on the verge of victory. In Yemen it was well on its way. There were even stirrings in Syria and large protests in Iraq.

But things have changed a lot in the last four months.

The revolutions in Egypt and Tunisia continue to deepen, with strike waves and the explosive growth of independent unions in Egypt. In Syria, the revolt against Assad continues unabated and, impossibly, grows even in the face of terrible repression. In Yemen, President Salah clings to power - though for what reason is unclear since all but his family have abandoned him - driving the country to the brink of civil war. In Bahrain, with US blessing, the Saudi military helped to crush the pro-democracy movement in a wave of repression and purges that continues.

And in Libya we've passed the 100 day mark since NATO started it's "humanitarian bombing" mission to "protect civilians." What has become clear is that while the revolt was rooted in the real and legitimate discontent of the Libyan people, that movement was quickly corralled and contained by forces with another agenda. Opportunists from the Libyan regime, senior figures who had happily gone along with the torture and repression of dissidents, suddenly "joined" the movement, forming the Transitional National Council. The popular elements, including the local committees that sprang up in the heat of the revolt were pushed aside. The struggle against the Gaddafi regime was transformed from a social struggle against a repressive neo-liberal dictatorship, to a military struggle between two factions of the regime.

Yesterday: Former UK PM Tony Blair with Gaddafi

No longer was it about an uprising and about winning rank and file soldiers to support the revolt and break with Gaddafi - a pattern that marked the early stages of the revolt. It now became about defeating Gaddafi-controlled troops in a military contest in order to elevate the former regime figures to the leadership - with policies that differed little from Saif the "reformer". But Gaddafi and his allies still controlled two-thirds of the country geographically, a significant amount of popular support and two-thirds of the state infrastructure, meaning that the former regime figures were outgunned and outmanned. With no apparent political strategy to deepen the revolt, they ended up in the arms of NATO, begging for the alliance's military support.

But the support of NATO, Europe and the USA comes at a heavy price. That price is clear - the first thing that was demanded of the TNC was that they agree to respect the oil contracts signed by the Gaddafi regime, including its terms. It is also likely that it will mean accepting a US base on Libyan soil - the US African Command (Africom) has been refused by every African country and so is stationed in Germany. This is a strategically important beach-head for the Americans, who feel increasingly squeezed by the Chinese, who are making substantial inroads into Africa - ironically, by spending money on infrastructure that was accumulated by selling Chinese goods to America and Europe (paid for with debt that is held by the Chinese). Prior to the revolt against Gaddafi, there were more than 30,000 Chinese workers and specialists in Libya attached to the sizeable Chinese oil investments. An article in The Globe & Mail last November gives a flavour of China's push into Africa:

On Monday, Chinese Vice-President Xi Jinping finished a two-day visit to Botswana in which he signed financing deals worth millions in infrastructure and energy development. Two days earlier, he’d made major deals in oil-rich Angola. On Wednesday in Ethiopia, Chinese private and state investors opened a $27-million leather-goods factory that will employ 500 Ethiopians; the same investment fund is also building cement plants and an airport hotel nearby. On Thursday, Sudan, which imports 80 per cent of its food, announced plans to quintuple its current wheat cultivation with backing from Chinese and Persian Gulf investors, increasing its acres under cultivation by 25 per cent a year for a decade.

And this is not an atypical week. The Chinese claim to have more than $1.5-billion invested in Africa now, up from $210-million; they employ at least 300,000 Africans in their own countries (and, increasingly, import African workers to the cities of the Pearl River Delta) and have built 60,000 kilometres of roads and 3.5 million kilowatts worth of power stations there – far more than any other country. Last year, China replaced the United States as the largest trading partner of South Africa, the continent’s biggest economy, and annual China-Africa trade topped $100-billion for the first time this year.

Russian interests are also under threat in the region as the US, UK and the EU jockey to make the maximum gains from the upheaval of the Arab Spring. It's no surprise that Russia has opposed intervention, not from any principled anti-imperialism - as the Chechnyans and Georgians could attest - but rather out of the fear of losing their toehold in the region, mediated through America's enemies (i.e. those countries whose policies aren't subordinate to America's interests) like Syria and Iran.

What is going on in Libya now must be seen in this light - as a hijacked revolution that now plays its part in a new Great Game between imperial powers jockeying for position in Africa and the Middle East, primarily China and Russia vs NATO & the USA. Not only is this game a dangerous one that could exacerbate tensions between the imperial powers, none of whom is likely to look kindly on the loss of infrastructure and capital investments, strategic relationships, etc. It is also a threat to the whole process of democratic revolution throughout the Arab world.

On the other hand, if NATO loses in Libya, it will be a massive blow to the ability of the alliance to project power beyond Europe's borders. The recent criticisms by outgoing US Defence Chief Gates makes clear that there are already tensions and frustrations within the alliance as a result of the unwinnable NATO war in Afghanistan. Defeat in Libya will be another nail in the coffin of one of the pre-eminent tools of the United States to spread its empire, alongside its junior European partner. It will also be a defeat for the Gulf Cooperation Council, led by the repressive Saudi regime, who have thrown in their lot with the emerging project to use the upheaval to reconfigure relations in the region - defeating thorns in the side like Syria's Assad (who is a Shi'ite and who supports Hezbollah, a Shi'ite movement) and the bombastic Gaddafi, who has offended the Gulf emirs more than once with his anti-colonial rhetoric.

Chances are there will be no "good" solution forthcoming in the short-term. Probably NATO will attempt to save face by declaring a limited victory via establishing the partition of Libya between Cyrenaica in the east and Tripolitania in the west. Cyrenaica will, of course, be a NATO client regime "protected" by the permanent presence of NATO/US troops and military forces. A victory by Gaddafi is also unlikely to bring democracy to the Libyan people. The real hope lies with the further deepening of the Tunisian revolution on Libya's western border and the Egyptian revolution on the eastern border.

In the meantime, the best bad outcome is for a defeat for NATO, which is a much bigger threat to world peace and democracy than Gaddafi has ever been. NATO is waging war in Afghanistan, to guarantee a strategic advantage against China on its western border and to encircle Iran to the west of Afghanistan. NATO countries led the war against Iraq - predominantly the US and UK, of course. The UK was the first country to rush into the Middle East after the Egyptian revolution to hawk more weapons to frightened dictatorships. The US, of course, is deployed in more than 150 countries around the world. The Libyans, at present, are not deployed anywhere outside of Libya and under Gaddafi were involved in or initiated three wars since 1977 - two of those were ostensibly anti-colonial: against a French neo-colonial regime in Chad and the other a protest against the Egyptian dictatorship's peace treaty with Israel. This is not at all to justify Libyan military interventions - let alone its corrupt and oppressive social and economic policies - but to make clear that Gaddafi's regime are not even in the same league as the US/NATO and, with a population of 6 million, can't even be described as a regional imperialist country.

France confirms arming Libyan rebels - Africa - Al Jazeera English

China or Greece: Which Is The Next Lehman Brothers?

Back in 2007, when the US Fed let the 100-year old Lehman Brothers investment bank go belly up, it was like a blasting cap that blew apart the global economy. While there was some recover last year and early into 2011, the global economy - and the economies of the developed world in particular - haven't made it back to pre-2008 levels. What's more, that recovery has receded in the second quarter of 2011 as the effects of big stimulus packages has ended and debt-straddled governments hit the panic button and turn to austerity to please international investors, speculators and ratings agencies.

That self-inflicted decline - like the self-inflicted greed bubble of 2008 - is on the precipice of leading to a much bigger economic explosion than the Lehman Brothers debacle. The two key sources of danger right now are Greece and China. Greece has been in the news in a big way lately because the riders of the banking apocalypse - the European Central Bank, the IMF and private banks and investors - are demanding a new round of austerity. Not surprisingly, the Greek population have had it with austerity and are set to explode, with Egypt-like sit-ins taking place in Greek town squares and union strikes and protests rolling through the country. The Greek PM had to, effectively, dissolve his cabinet and return to parliament for a vote of confidence tomorrow before moving forward with the next round.

With an unstable Greek government facing mass opposition in the streets and a divided parliament, and with the European Union unable to agree on a plan to bail out the country, there is a very real chance that Greece will default on its debt. A default on Greek debt will have a much more massive impact on the global economy than the Lehman Brothers collapse. And it will spread quickly to deeply indebted Italy and Belgium and beyond. Greedy bankers, gotten fat off cheap money and deregulated markets, which led to the present crisis in the first place, will howl at the thought that they have to pay for the bonuses and bad decisions of the past decade. They will use their control of money to wreak destruction to the global economy as they did in 2008 when they took their money and went home, leaving the economy to starve from a lack of credit.

In China, the world is discovering that the monolithic Chinese state and ruling class aren't so monolithic after all. While the supreme leadership under the premiership of Wen Jiabao have been trying to steer the Chinese economy away from dependence upon infrastructure investment, as well as to cool the overheated property market, an article in today's New York Times suggests that, if anything, things have been moving in the opposite direction. The Chinese economy has diversified and local and regional political leaders have their own independent power bases that can resist diktats and priorities from the centre. Those regional forces also have other levers so that when the state withdrew from lending, non-banking lenders stepped in. The result is that there could be as much as half a trillion dollars in non-performing loans. Many of those loans are in the infrastructure investments that have kept Chinese growth motoring along even as the market for Chinese exports, still a big portion of the country's GDP, has receded. Jiabao and other Chinese leaders are faced with a wave of crippling defaults or the possibility of a big collapse in demand if they try to rein in out of control credit growth and infrastructure investment.

Most commentators are focused on Greece, whose collapse seems most imminent but China's dangers are being covered up by past enthusiasm for the seemingly unstoppable juggernaut of ten percent annual growth rates. And a bursting bubble in China will be orders of magnitude bigger than a Greek default. Don't forget that America is mortgaged to the hilt, with rating agencies starting to get nervous about government debt levels. And most of the foreign-owned US debt is in Chinese vaults. If the world's second biggest economy needs to liquidate assets quick to cover big losses, what do you think that they'll be selling? If the value of US debt collapses and, thus, the cost of borrowing rises, things could get ugly.

Not to put too fine a point on it, the people who run the global economy - and have done so through the use of speculation for the past three decades - have painted the economy into a corner. They're the problem and they have no solution. The Greek working class are the only voices of sanity we're hearing and their answer is clear: let the bankers pay. It is a condemnation of a system driven by greed and chaos. It's time for democratic planning based upon human need.

China Boom Beginning to Show Cracks, Analysts Say - NYTimes.com

Today's U.S. Economic News: This Parrot Is Dead

The jobs report is out and like all of the other economic indicators, it shows that the US economy is going nowhere fast. The whole of this year has been about watching the optimism that started the year turn sour bit by bit as the remaining effects from the stimulus spending have evaporated. The reality is, the Anglo-American model of market driven growth, deregulation and the repression of trade unions, has not done what it claimed - create a virtuous cycle of endless growth that superceded the stagnation in productivity and innovation that supposedly plagues economies that have greater state intervention.

The present "soft patch" - known in the jargon of regular folks as a recession - is one more stake through the heart of the neo-liberal consensus that has haunted us since the end of the 1970s. It's worth noting that this has never been about state vs market capitalism. Every capitalist state uses elements of both. Every American boom has, particularly since the 1980s, been about increasing the levels of debt in the economy as a means to reinflate it in the face of weak growth. This is, in economic effects absolutely not a whit different than Greek (or any other) state debt - as I've discussed elsewhere. In terms of an economy having room to maneuver - through state or corporate or consumer or combined purchasing - the level of total debt is the key number. Attacking state spending is just the latest way of attacking working class living standards, full stop. Now, I'm no fan of the capitalist state but to think that it was more rational to simply print money and drop interests to the floor so that uncontrolled investment and speculation could ensue - rather than focusing investment on things that the national economy needs - was always absolutely barmy.

American political and economic leaders (and Canadians and Brits) have been strutting around since the "Japanese model" went bust about 15 years ago, bragging about how effectively their model was generating wealth. In fact a significant portion of the "new" wealth was made up of phoney speculative wealth, exotic debt instruments, sub-prime mortgages and the like - the Chinese and others were directing investment into needed infrastructure. For example, China now has 13,000 km of high speed rail - more than the rest of the world combined - which will climb to 25,000 km by 2015. The USA (and Canada) have 0 km of high speed rail. Shall I repeat that: there are zero kilometres of high speed rail in North America. And when Obama suggested a role for the US state in spurring investment in high speed rail, the mouth-breathers in the Republican party and Fox News went apoplectic. The only welfare program they support is $1 trillion for the military, tax cuts for the rich and bailouts for the banks. Meanwhile, America has also fallen behind in renewable energy technology in relation to Asia in general and China in particular. Seven of the world's 10 largest solar manufacturers are Asian, with the number two company being China's Suntech Power. And China invests four times the amount in clean technology as the USA.

Don't get me wrong, I'm not at all suggesting that China is a utopian model - neither in terms of long term economic stability, nor in terms of basic freedoms - but if a crash comes in China, at least they can ride the trains. In the US all they'll have is guns and empty, foreclosed houses. Though, come to think of it, having the former could solve the problem of the latter. Who's going to evict a heavily armed squatters' movement?

U.S. jobs growth brakes sharply in May - The Globe and Mail

The Tories' Bankrupt Brains

"I see, said the blind man to the deaf dog, who wasn't listening anyway" is a phrase that comes to mind reading reports of federal Finance Minister Jim Flaherty's press conference on the economy. Generally speaking we expect governments to do more to solve looming crises than beg somebody else to do it for them. It is a sign of just how ideologically blinded are the Tories that they will ride the HMS Neo-Liberal to the bottom of the economic ocean before they will take any initiative to plug a leak using the instruments of state.

Capacity Utilization

Flaherty's response to flagging consumer demand has absolutely no hope of staving off a looming second dip in the as-yet-unfinished recession of 2008. The decline in consumer spending as we regular folk are saddled with historically high debt - there was a brief dip in debt as a percentage of income before returning to a generally upward trend toward 150% - means that 60% of what normally makes up economic expansion has been taken offline.

And while industrial investment and new machinery is up - in part because the rise in the Canadian dollar has made imported capital goods cheaper - has a number of inbuilt limits in terms of saving the economy. The first is the dead consumer demand to purchase goods of any new production capacity. The second is the fact that capacity utilization - the measure of how much new machinery is being used; is it running flat out or sitting idle part of the time? - is still at the lowest levels in a decade, sitting at 76% and levelling off.

And while manufacturing saw growth in 2010, it is still 15% below where it was at its peak in 2006. And even corporate debt levels, which declined during the recession, only declined by about 4% in relation to income from their peak and are rising once again. With the slowdown in the US and a slowdown looming in China, plus the disaster in Japan, along with inflation of raw materials running at a whopping 22%, this is hardly the moment when corporations are likely to find the dosh to ratchet up capital purchases to anywhere near what is necessary. In fact, when Flaherty says that the corporate sector is "relatively flush" with cash, they could easily reply that, in fact, total corporate debt to equity ratios - at 166% - is considerably higher than total government debt (i.e. federal, provincial, municipal, etc) to GDP, which is running at just over 107%. In other words an economic bailout from the fragmented corporate sector, each trying to gain competitive advantage over the other, just isn't in the cards.

And, as I discussed in my previous post, there is every chance that, in addition to weak economic figures, the government could face pressure to raise interests rates to deal with inflation, originating with the high cost of raw materials. And nothing kills an anemic recovery more effectively than high interest rates. The net result could easily be that the Stephen Harper's hope and dream of forming a majority government may come back to bite him in the ass. They don't have the Liberals to kick around anymore as a hindrance to doing what needs to be done. They will get all the blame if things start to really go south. Unfortunately, for the rest of us, we don't risk unpopularity - it's our livelihoods and ability to pay the bills that are at risk.

Time for business to take the lead: Flaherty - The Globe and Mail

The Return Of Stagflation?

Those of us around in the 1970s will remember the term stagflation - a combination of economic stagnation and inflation that created a conundrum for bourgeois economists: do you move to rein in inflation by tightening credit and imposing wage and price controls - or do you seek to boost economic growth by loosening credit and "priming the pump" by injecting billions into state directed projects. As it happens the first thing they did was attack workers by imposing wage controls (price controls were bullshit), either through direct legislation (Canada and the UK) and/or by encouraging open war on the collective bargaining right of unionized workers (Reagan's firing of 10,000+ striking air traffic controllers). That was combined with interest rates that went through the roof - up to 20% at their peak. Then, once the working class was defeated, there was a return to loose money - Reagan increased military spending (and thus the deficit) massively, there were big tax cuts for the rich and policies that encouraged the growth in speculative investment (and, thus, stock and property bubbles).

Well, if you liked that economic bloodbath the first time around, get ready for the next round.

First off, the damage - both social and economic - from that first battle against stagflation is still with us. The North American economy is much more "financialized" than it was before. Speculative bubbles - that roam from sector to sector; now in stocks, then in tech, later in housing followed by commodities - continue as a matter of policy in an attempt to keep the economic inflated. In fact, price and credit inflation - combined with social and wage austerity - is the economic policy of western governments to this day.

But they face a problem that is the result of the success of these policies in many ways. The Chinese miracle is, in part, a product of the fact that increasingly squeezed western workers, particularly in the USA but also in Europe, need the cheap goods produced in the sweatshops of China to sustain their standard of living along with access to easy credit. China's export led boom can't be separated from the boom in debt in the west - total US debt, private and public, is now close to 400% of US GDP. Nor can it be separated from the decline in unionization and real wages (which includes the "hidden" social wage of services previously provided by governments and now privatized - from public pools and community centres to welfare and unemployment insurance rates, pensions and healthcare).

The debt/sweatshop model could work for a while but it reaches its inevitable limits when debt simply can't grow any further; consumers and businesses can't afford to add any further to their debt servicing costs. Oh, this can be creatively skirted and hidden for a while - the exotic debt products of the first decade of this century proved that. The crisis of 2008, however, was a sign that the debt shell game was coming to an end. Massive state intervention was able to prevent total economic collapse but it can't wish away the debt loads held by everyone and that means that growth will, at best, remain sluggish after the brief episodes of state intervention end. In weaker countries, like Greece, it means the threat of default as international bankers, the lowest form of human, try to push a program of massive debt privatization - so that they can recoup state loans as though depressing consumer demand will somehow save an already depressed economy.

These recessionary pressures are bad enough but the boom in China - itself fuelled by debt, perhaps half of it bad - has had the effect of jacking up global commodity prices. This creates a conundrum for China - on the one hand capital investment (infrastructure, new manufacturing plants, etc) has led the growth in China, as opposed to a growth in consumer demand. That means that China needs a higher valued currency to lower the costs of imported raw materials. But it needs a cheaper currency in order to keep their goods - for which there isn't a sufficient internal market - cheap for export. The Chinese leadership is trying to change the balance between capital and consumer investment but faces lots of hurdles.

While there is much talk about the "efficiency" of the one-party state in terms of being able to rapidly implement policy shifts, things aren't that simple in a country - and an economy - this size. The rapid growth of China over the last thirty years has created a large, wealthy and very powerful capitalist class, primarily concentrated in the coastal cities. They have regional fiefdoms that are dependent upon cheap and plentiful credit and infrastructural and capital investments (and corrupt kickbacks therefrom). And they have a number of tools at their disposal to resist the central government's attempt to change the priorities of investment. One of them is simply to create an underground credit economy to loan money for projects as they see fit - it's estimated that close to one third of all new loans in China are through this sector. The other mechanism is to simply send money offshore to tax havens before cycling is back into China to invest as they see fit - over half of the $1.1 trillion in foreign direct investment into China is, in fact, money of this sort and not really "foreign" money at all. Foreign investment has, in fact, stagnated for over a decade.

The Chinese government also faces pressure from the ordinary people of China - workers and peasants - who see and feel the results of the "Chinese model" of development first hand. Peasants are expropriated by regional governments for their pet projects - from dams and wind farms to chemical plants and other manufacturing facilities. Workers see the investment boom year after year after year and haven't seen a commensurate amount of wealth "trickle" down to them. This has led to mass - though still fragmented - resistance. In March of last year, in the town of Huaxi, 20,000 people took over the town and threw out the 3,000 local cops, then burned police property and, get this, sold tickets to the rebellion. The revolts are having an effect - many companies are giving pay hikes of 20-40% in order to end strikes and rebellions by workers.

The failure of the Chinese government to effect the sort of change that the entire leadership in China - in words - recognizes is necessary, means that pressure is building that is effecting the global economy. Commodity inflation is killing the fragile economy in Europe and America (oil economies like Alberta aside) as more income and profit goes to just covering the basics. Back in China this translates into a slowing of the export-oriented manufacturing sector - still accounting for about half of GDP (I believe). So, China and the world face the combined impact of an over-heated Chinese capital investment sector, leading to global price inflation (and to wage inflation inside China) and the potential return to recession. With even less room this time around to use the instrument of state investment to prevent the return of economic crisis - because of high debt and high inflation - it's unclear what governments will do this time around. Pray, I suppose. Or fiddle - while Athens, Rome, Madrid, et al burn.

Some links:
FT.com / Comment / Analysis - Global economy: A high price to pay

Brake in manufacturing momentum in Europe, US, Asia - The Economic Times

Dissecting the Chinese Miracle | STRATFOR

10 Global Signs That the Market Is at a 'Tipping Point' - Seeking Alpha