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The Flaws of Capitalism

Capitalism Described, Capitalism Disassembled

by RON JACOBS

The fundamental problem of capitalism is that “it is structured, in its very operation, to make it impossible for millions, even billions, to be free in any meaningful sense.” This statement appears in the concluding chapter of economist Geoff Mann’s important new book, Disassembly Required: A Field Guide to Actually Existing Capitalism. Mann’s text is concise, clear and a necessary contribution to the discussion of a livable future. In a time when the devastation of neoliberal capitalism reveals itself in the collapse of factory buildings in Bangladesh, executive decisions in Washington, DC, and austerity measures around the globe, the need to understand why capitalism cannot cure the problem takes on an immediate urgency.

9781849351263Essentially, Disassembly Required is a textbook. I make this statement not to dissuade one from reading the book. I do so as an attempt to explain the function of the book. Mann has taken the fundamentals of capitalist economics in the twentieth and twenty-first centuries and explained them without the curtain most explanations hide behind. There is no wizard of capitalist Oz here. The history of monopoly capital, its manipulations of global politics and its intentional separation of most of the world’s population from control over their destinies is explained in patient and layperson’s terms. Utilizing Marxist and left-anarchist analysis, Mann rips apart the mythology of eternal growth, austerity and the suicidal quest for profit that drives the whole machine.

Quietly, and with a reasoned argument, this text examines the formation of modern capitalism in the writings of Adam Smith, its realignment in the twentieth century into what we know as Keynesian methodology, and its mutation into the current formation known as neoliberalism.  Disputing the classification of neoliberalism as classical economic, Mann rips the myth of how it functions to shreds.  Not only does he do this to neoliberalism, Mann completes the dismantling of the myth by pointing out the fundamental flaw in the champions of capitalism’s argument.  That flaw is, of course, that capitalism only works like it’s supposed to in an arena where everything is absolutely perfect; where the market is fair, where capital accumulation is not weighted towards those with more capital, and where wages are the same across the board.  Of course, this arena does not exist in real life, only in the fantasies of the Milton Friedman and the like.  That, writes Mann, is where the faith in the market comes in.  The emphasis, as Mann points out, is on the word “faith.”  Like any other religion, the religion of capitalism requires a fundamental leap of faith.  Without it, it is like that emperor and his new clothes in the fairy tale.

Using anecdotes from the daily news (Greece, subprime crisis, etc.) and practical experiences of an individual in the capitalist world we exist in, Disassembly Required patiently explains how the economy got into the mess it is in.  It also explains why there is really no way out of it short of revolution.  The hegemony of the neoliberal dynamic–a dynamic where everything has a price–has rendered reform of the system pointless.  To verify this, one need only look at the situation of the so-called socialist governments in Europe and the Democrats in the United States.  The Keynesian model has been ripped to shreds and all that remains is the selloff of every public good previously managed by the government.  Every day one is reminded of this: schools being closed and replaced with corporate charter schools, bridges collapsing because they are no longer maintained, school teachers and other public servants having their collective bargaining rights stripped away and their initiative channeled into administering corporate-designed tests whose main function is profiteering for said corporation.  Even the warmaking function of the state is being sold to the corporate world.  In other words, the hegemony of neoliberal capital has bound us all in its prison of profits for the few and the powerful.  Politicians clamor for their piece of the pie, trampling the rights of the poor, stealing the incomes of working people (those whose jobs they haven’t sold), and generally behaving like the corporate criminals whose pocket they are in.

If I taught economics, Disassembly Required would be the only textbook I would need.  After reading this, my students would either be ready to revolt or they would enter into the world of finance knowing full well that what they were involving themselves in was no different from the activities of an underworld gangster.  Unfortunately, not even Mann has an alternative.  Authoritarian models like China and the Soviet Union either failed, became capitalist or both.  As noted above, social democratic states have been swept into the neoliberal net, consequently failing to provide essentials to those in their borders who are the least represented.  A recent example of this latter situation can be found in the youth/immigrant riots spreading across the ultimate social democracy, Sweden.

Continuing the work begun by Karl Marx, Geoff Mann’s Disassembly Required provides the reader with an analysis of capitalism that exposes its fundamental flaws and its amorality.  Destroying the myth that democracy cannot survive without capitalism, Mann’s text demands that we utilize the analysis inside its covers and create a truly democratic and just economy.

Ron Jacobs is the author of the just released novel All the Sinners, Saints. He is also the author of The Way the Wind Blew: a History of the Weather Underground and Short Order Frame Up and The Co-Conspirator’s Tale. Jacobs’ essay on Big Bill Broonzy is featured in CounterPunch’s collection on music, art and sex, Serpents in the Garden.  His third novel All the Sinners Saints is a companion to the previous two and is due out in April 2013.  He is a contributor to Hopeless: Barack Obama and the Politics of Illusion, published by AK Press.  He can be reached at: ronj1955@gmail.com.