Global Financial Crisis 2008 – Article No 02
by Humphrey McQueen
Not socialism
“Casino socialism” is how some US Republicans have denounced the proposed $700bn bailout of the mortgage market. Meanwhile, the “S” word is being revived by everyone alienated by the past thirty years of free marketeering. A temptation to Schadenfreude is understandable as devotees of the discredited Marx watch his old enemy stagger. But the collapse of capitalism is no time for self-indulgence. Nothing is more vital in class politics than having a clear head about the nature of the state.
[Given the stupefaction induced by the “news”, that clarification perhaps needs to start by pointing out that the “state” about which we speak is every form of government apparatus, not just those known as States, such as Queensland or California.]
Now let’s remind ourselves of what the state is with four aphoristic definitions:
1. The state is the executive committee of the bourgeoisie.
2. The state is the more-or-less open or more-or-less covert dictatorship of the bourgeoisie.
3. The state organises capital and disorganises labour, as we see with Gillard’s “Fairness” in the IR laws.
4. The state attempts to do for the expansion of capital what its managers cannot achieve through their corporations.
From this perspective, the bail-outs, the nationalisations and the guided mergers are what the capitalist state has always existed to do. It has either paid for the infrastructure projects needed to perpetuate the expansion of capital, or provided tax breaks and other concessions. Also to that end, the state wages wars and breaks strikes. The state is not our friend.
The state remains, however, the site for all the conflicts between classes and within them. Every temporary resolution of those disputes must pass through the apparatuses of the state to appear as legitimate. This seal of “law and order” means that the struggles that result in victories for the working class are contained within government programs. The welfare state, for instance, was never a transition beyond capitalism but a means for controlling its gales of creative destruction. In addition, much social welfare spending is a way of passing the costs of reproducing labour power back onto those workers who cannot avoid the PAYG tax regime.
The clawing back of even those concessions has sown confusion around the Left about the meaning of “private” and “public”. Private schools are not private but tax-funded non-government businesses. The government ones are not there to serve “the public” but to supply corporate capital with employees skilled enough to add value. There has been next-to-no privatisations in the recent past. What we have suffered is the sell-out to corporates. In a rare instance of privatization, Warwick Fairfax failed to reclaim the family newspaper chain in 1987. The $700bn bail-out is a different form of privatisation, this time on behalf of the conglomerates, with its success as doubtful.
Wall Street will reveal its conversion to socialism once it has smashed the bourgeois state and started building the dictatorship of the proletariat.
Next: Don’t pick on bankers