The Collapse of Capitalism?

Many of us have been predicting the collapse of capitalism for 150 years. One day, we’ll be right.

Another way to look at our situation is that, actually, capitalism collapsed in 1929. At the time, there was a powerful socialist movement, headquartered in the Soviet Union, fully poised to take over where capitalism left off (not to say it wasn’t highly flawed). The panic among the capitalist class was palpable. They were able to resuscitate capitalism only by unleashing on the world from Germany, Italy, and Japan a fascist movement of unprecedented viciousness and launching a world war which destroyed perhaps half the infrastructure of Europe and slaughtered somewhere between 50 and 70 thousand working class people. How was that for taking the thunder out of the socialist movement? Thus, too, did the capitalists have a new lease on life.   

In simple terms, capitalism collapsed because it had expanded as far as it could go in 1929. Capitalism requires constant growth in order to maintain itself. By destroying both the people and infrastructure of Europe and Asia in the war, capitalism gave itself plenty of room to grow again. By defeating socialism, thanks largely to the hot war followed by the cold war, capitalism found itself able to expand even into the former Soviet Union. I would argue that China, a feudal country at the time of the revolution, never really made it to socialism. For socialism to function, apparently, a society needs a certain productive capacity, and capitalism is ideally suited for developing that capacity. It’s of course ironic that the latest crisis of capitalism has been caused by the crash of the Chinese stock market.

It’s odd that for all the grief showered on Marxism by the capitalists, no one seems to challenge the Marxist theory of history. It would appear that most economists and sociologists accept the idea that slave-based systems were replaced by feudal systems which were replaced by capitalist systems. 

We need to talk about systems. The capitalist system now bears an uncanny resemblance to the alien creatures in the movie “Alien.” That is, the capitalist system is so desperate to survive that it will do anything, even massacre 70 million people. We can rail all we want at the greedy capitalists, but if we could make the Koch brothers and the Trumps disappear overnight, the system would find new agents to ensure its survival or at least pull out all the stops in its effort to survive. The capitalist system needs to be replaced – at least before it creates another cataclysm on the scale of World War II, and I see nothing that has happened since that war to indicate that sooner or later the system will not need to create another such war in order to survive.

So it is good that the Bernie Sanders campaign is talking about socialism. But, fortunately or unfortunately, the kind of socialism that Bernie is talking about is not the same as Marx was talking about. Social democracy is a system that came into widespread prominence after World War II as a compromise between the left and the capitalists that met some of the demands of the working class while keeping capitalism and its handmaiden, imperialism, basically intact. Social democracy has been a pretty good deal for the working class of Europe – as well as a number of South American countries – and I’m hopeful that the Sanders movement can establish such a system in the U. S.

Social democracy can perhaps postpone the collapse of capitalism by addressing one of the fundamental contradictions of capitalism, which is the tendency of the capitalists to pay the working class insufficient money to consume the products it produces. By investing the profits of capitalist endeavors back into the working class in the form of higher wages, better benefits, free health care, free education, free child care, etc., social democracy delays the collapse of capitalism. Given how brutal that collapse is likely to be, we would do well to embrace this delay.