Subjects Archives: Socialism

Medical officers measure body temperature of passengers at a railway station in Kochi (state of Kerala) on March 16

An often overlooked region of India is a beacon to the world for taking on the coronavirus

In a pandemic, a rational person would much rather live in a society governed by the norms of socialism than of capitalism, a society where people rally together to overcome a virus; than to live in a society where fear pervades and where stigmatization becomes the antidote to collective action.

Pedro Ribeiro Simões Follow Democracy Museu do Aljube - Resistência e Liberdade (Icons) Lisbon, Portugal DEMOCRACIA (Possible definitions) U.S. president Abraham Lincoln (1809-1865) defined democracy as: «Government of the people, by the people, for the people»

What is ‘social democracy’?

Marx Memorial Library

GOOD question! Look up the term in a dictionary and you’ll find a definition something along the lines of “an ideology that advocates or supports political, social and economic interventions to promote social justice within the framework of a representative democracy and capitalist economy.”

Building Capacity with Money on the Left

Maxximilian Seijo, Scott Ferguson, and William Saas

This month’s Money on the Left episode departs from the show’s regular interview format to reflect on the past, present and future of the Money on the Left project as a whole. We focus, in particular, on a recent special scholarly journal issue dedicated to Money on the Left, which was published by Liminalities: A […]

Slate photo illustration for the article “Sanders Has a Soft Spot for Latin American Strongmen” (2/20/19).

Media malfunction as Sanders notes positive aspects of Latin American socialism

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When 60 Minutes (2/24/20) asked Sen. Bernie Sanders about his past support for aspects of Cuba’s socialist revolution, as well as for Nicaragua’s 1979–90 leftist Sandinista government, Sanders responded by saying he opposes what he described as the “authoritarian” features of the Cuban government, while noting that after the 1959 revolution, Cuba launched “a massive […]

"Whoever it was, I think they're a little outnumbered tonight," Sen. Bernie Sanders (I-Vt.) said after the man with the Nazi flag was removed from the rally. (Photo: Screenshot/Bernie Sanders Campaign via Storyful)

Absolutely sickening—and scary’: Man unfurls Nazi flag at Bernie Sanders rally, heightening security concerns

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“All people of conscience must condemn this anti-Semitism against the most visible Jewish politician in the country.”

This article is meant to clarify a point made earlier (Why Didn’t Socialism Have Over-Production Crisis, Newsclick, June 30, 2018) about the erstwhile socialist economies not having over-production crises as capitalist economies do. It is in the nature of capitalism to have “over-production crises”, i.e., crises arising from “over-production” relative to demand. “Over-production” does not mean that more and more goods keep getting produced relative to demand, so that unsold stocks keep piling up. This may happen only for a brief period in the beginning; but as stocks pile up, production gets curtailed, causing recession and greater unemployment. “Over-production”, in short, is ex ante, in the sense that if production were to occur at full capacity use (or at some desired level of capacity utilisation), then the amount produced could not be sold because of a shortage of demand. But it manifests itself in reality in terms of recession and greater unemployment. It is a mistake to believe that such crises are only cyclical in nature, i.e., that they get automatically reversed after a certain period of time. On the contrary, the Great Depression of the 1930s, which was a classic over-production crisis, lasted nearly a decade and was finally overcome because of the war, or, to be precise, because of military expenditure in preparation for the Second World War. Read Also: Why Didn’t Socialism Have Over-Production Crises? Since 2008, there has again been an over-production crisis that has persisted with varying intensity right until now. There is, thus, no question of an over-production crisis under capitalism automatically disappearing. But what was striking about the erstwhile socialist economies of the Soviet Union and Eastern Europe is that they were free from over-production crises. The question is why? Over-production crises under capitalism arise because of two main reasons. One, investment decisions under capitalism depend upon the expected growth of demand, for which the current growth of demand is taken as a clue: if demand slows down then investment gets restrained. Two, whenever investment gets restrained, so does consumption and hence total income (this is called the “multiplier” effect of investment). Both these factors were eliminated under socialism. Investment was undertaken according to a plan and not the dictates of profitability; hence, there was no question of investment being curtailed when the growth of demand slowed down for any reason. This is not to say that there were no fluctuations in the level of investment. These fluctuations, however, arose not in response to profit expectations, but for entirely exogenous reasons, of which, two in particular were important. One was agricultural output fluctuations. In years when the agricultural output went down for weather-related, or some other, reasons, investment was cut, in order to prevent excessive upward pressures on food prices; correspondingly when agricultural output revived, so did investment. These investment fluctuations, however, had nothing to do with any calculations of profitability on investment; they were unavoidable even in a planned economy. The second reason was the operation of “echo effects”. Suppose, for instance, that a whole lot of new investment had been installed in a bunched manner at a certain date, say the beginning of the planning period. These pieces of equipment would become due for retirement again in a bunched manner around the same time some years later, which would, therefore, push up the investment plan, and hence the real gross investment around that time, so that both net investment and replacement needs are accommodated. The investment figure, therefore, would not show a steady growth but would exhibit fluctuations. But these fluctuations again had nothing to do with any calculations of profitability; they arose because of past investment history. But even when such investment fluctuations occurred, socialist economies ensured that they did not lead to fluctuations in consumption and income, i.e., those economies snapped the multiplier relationship that necessarily characterises capitalism. This is because all firms in the economy were asked to produce to their capacity, and, if demand was low because of investment being curtailed, then they were asked to lower their prices until whatever they produced got sold. At these “market-clearing” prices, some firms would make losses, while others would still make profits; but this would not matter since both the profit-making and the loss-making firms belonged to the State, which could, therefore, cross-subsidise the loss-making ones from the profits of the profit-making ones. And taking both groups of firms together, there would always be positive net profits as long as investment was positive (even if lower than would have been otherwise). This was a remarkable break from what happens under capitalism, and provides a clue to why output and employment fall in a crisis there. Under capitalism, a firm does not produce when prices do not cover costs; and when demand is low, prices do not fall, because they are “administered” through collusion among the oligopolistic firms. Instead, output, and hence employment, fall in order to equate supply with demand, and to eliminate stocks which might have got built up briefly. The matter can be looked at somewhat differently. A fall in price, with money wages and employment given, which is what happened under socialism, meant a rise in the share of wages in total output; income distribution in short shifted in favour of the workers. Since workers more or less consume their entire wages, such a shift in income distribution in favour of the workers raised the share of consumption in total output. Thus, socialist economies never experienced over-production crises because even when investment fell for some reason, output was kept unchanged and the share of consumption rose to compensate for the fall in investment (through a rise in the workers’ share in output). This, however, can never happen under capitalism because capitalists would never voluntarily agree to a lowering of their share in output and a corresponding increase in workers’ share, even in a situation of inadequate aggregate demand. This is why capitalism experiences over-production crises: income distribution here is a matter of intense class-struggle where there is no question of capitalists agreeing to lower their own share and correspondingly raise workers’ share for the sake of overcoming a situation of over-production. The “multiplier” that operates under capitalism, whereby a reduction in investment causes a reduction in consumption and hence total output, occurs because of income distribution not being adjustable. The “multiplier”, in other words, is predicated upon the relative shares among capitalists and workers being given. In fact, under capitalism, far from the workers’ share rising to offset the problem of insufficient demand, the tendency in periods of crisis is the exact opposite, namely, to cut wages and raise the share of profits, which, in a situation of reduced investment that brought about the crisis in the first place, actually compounds the crisis. A 10% fall in investment in such a situation does not just bring about a 10% fall in output, as the “multiplier” analysis would suggest, but a more than 10% fall in output, say a 15% fall, because an additional squeeze on consumption through a fall in workers’ share (via the wage cut) is further superimposed upon the reduction in investment. The fact that the relative share of the workers is not allowed to increase in order to offset the tendency towards over-production, which is a basic characteristic of capitalism, also shows its supreme irrationality as a system. It shows that the system would rather have larger unutilised capacity and unemployment, i.e., a sheer waste of productive resources for lack of demand, than produce as before by avoiding this waste through giving more to the workers. From its point of view, wasted resources are preferable to using these resources to improve workers’ consumption. True, not being a planned system, it does not make such calculations consciously; but that is what its immanent tendencies amount to. Socialism avoids any waste or slack, such as is caused by a crisis, by raising the consumption of workers appropriately to avert it. As the collapse of the Soviet Union recedes further into history, people increasingly forget that a system had existed there, which, notwithstanding its many limitations and defects, had nonetheless been free of unemployment, of over-production crises and of the irrationality of capitalism.

Capitalism, socialism and over-production crises

Prabhat Patnaik

Unlike capitalism, socialism avoids any waste or slack, such as is caused by an over-production crisis, by raising the consumption of workers appropriately to avert it.

Bolivia: An election in the midst of an ongoing coup

Vijay Prashad

On May 3, 2020, the Bolivian people will go to the polls once more. They return there because President Evo Morales had been overthrown in a coup in November 2019.

A possible Communist redefinition of love

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In In Praise of Love, Alain Badiou defined love as a form of “minimal communism [where] the real subject of a love is the becoming of the couple and not the mere satisfaction of the individuals that are its component parts.”(1) Earlier in the book, Badiou provided a more elegant statement, associating the act of […]

News flash: Billionaires don’t like socialism

Alan MacLeod

Big news, everyone! Billionaires don’t like socialism.

Welcome to Global Ecosocialist Network

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The Global Ecosocialist Network (GEN) is being launched at a moment of extreme danger for humanity. The intensity of the crisis and the scale of the danger is hard to grasp or express adequately because, unless you are in one of the parts of the world currently experiencing extreme weather, it cannot yet literally be […]

To rig primary against Bernie, DNC chair Tom Perez nominates regime-change agents, Israel lobbyists, and Wall Street consultants

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With Senator Bernie Sanders surging in the polls, DNC chair Tom Perez has put forward a cartoonishly neoliberal cast of foreign policy hacks and corporate lobbyists to sabotage his nomination.

Statue Dessau Marx - Free photo on Pixabay

Marx’s concept of socialism

Peter Hudis

The discussions and debates that have accompanied the 200th anniversary of Karl Marx’s birth since 2018 have provided an important opportunity to re-examine heretofore neglected aspects of his political and philosophical legacy. Foremost among them is the extent to which his body of work provides conceptual resources for developing a viable emancipatory to capitalism in […]

In Commune: Pancha Vásquez

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This chapter of “In Commune” explores the Pancha Vásquez Commune in Apure state, where communards are working hand in hand with local farmers to fight smuggling and speculation with autonomous barter systems and communal markets.

Steam Community :: Guide :: The Game of Capitalism in DF2

The “fixing capitalism” headfake

Yves Smith

It’s not hard to see why young people are embracing socialism. It isn’t simply that they can see a probable grim future under capitalism as they know it: more and more low-wage, high surveillance jobs versus more budget and psychological stress as most also have higher fixed costs (rentier housing costs, student loan payments, even […]

Neoclassical Marxism (Christmas Special) with @NMarxism

Maxximilian Seijo, Scott Ferguson, and William Saas

This December, we bring you a special Christmas episode of our program, featuring the enigmatic operator behind the increasingly popular Twitter account known as “Neoclassical Marxism,” or @NMarxism. @NMarxism is a deeply satirical Twitter project, which deploys Modern Monetary Theory and some very dark humor to critique the neoclassical economics and neoliberal assumptions that unconsciously […]

Making sense of a shattering defeat

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As soon as the scale of Labour’s shattering defeat began to emerge last night, pundits began to push the line that this was not just about Brexit but about Jeremy Corbyn and the shift towards socialism. No election is just about one issue—but the evidence backs up the argument that Brexit was the defining factor.

The Coming Revolution: Capitalism in the 21st Century

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The Coming Revolution is an impressive guide for Marxists looking for a way to approach contemporary capitalism, argues Josh Newman

Hanna Gharib, general secretary of Lebanon's Communist Party

‘We want to put a nail in the coffin of this sectarian system’

Eds. and Max Ajl

“Today, the American project is attacking on all axes. We cannot resist it on one axis without the other, i.e. just on the military side. We must resist it at all levels: intellectual, political, economic, and social.”

Jeremy Corbyn speaking at the Labour Party election launch, 2017. Photo- wikimedia commons

BBC attacks Corbyn over his correct stance on foreign wars

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Corbyn’s position on Britain’s military adventures has been right on every occasion, argues Chris Nineham.

The Wall and General Pyrrhus

Victor Grossman

A stern, history-based evaluation awakens doubts that, despite the paeans in the world media, the fall of the Berlin Wall was not purely a peaceful revolution, a choice of freedom by the masses, another successful victory for freedom and justice as in past centuries.

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Monthly Review Essays

United States Imposed Economic Sanctions: The Big Heist
by Lauren Smith
The money trail of U.S. Sanctions leads to the Federal Reserve Bank of New York, which—behind the shadow of secrecy laws that effectively prohibit any form of public accountability—facilitates the theft of public wealth from targeted countries on a scale only previously accomplished through military invasion and occupation.
Beyond the Permanent State of Emergency
by Rebecca Manski
Not long before the Twin Towers fell, the Italian philosopher Giorgio Agamben resurrected a concept anathema to the liberal notion of progress—the idea that unrelenting crisis is not necessarily exceptional. Agamben employed the image of “the Camp” to describe the space and time “when the state of exception begins to become the rule.”

See all Monthly Review Essays

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Subjects Archives: Socialism