The Poverty of Capitalism and the struggle for another world.

The current global economic crisis has been covered extensively within academic literature and the wider (social) media alike. Few, however, have tackled the topic with the ambition of questioning capitalism itself. John Hilary’s book The Poverty of Capitalism: Economic Meltdown and the Struggle for What Comes Next (Pluto Press, 2013) is a welcome exception here. In this blog post, I will provide a critical engagement with this excellent analysis of capitalist crisis and moves towards alternatives. 

The power of transnational capital

John Hilary, Executive Director of the British NGO War on Want and Honorary Professor at Nottingham University, looks in detail at three economic areas, which have been dominated by transnational capital at the expense of workers’ most basic human rights, extraction, garments and food production. ‘The Marikana massacre’, he argues, ‘is a brutal reminder that direct conflict with the extractive industries’ insatiable drive for profit remains a daily reality for millions of people across the world’ (P.99). While Western countries and increasingly emerging economies such as China continue to exploit the mineral wealth of developing countries, the dispossession of the local population often includes widespread human rights abuses.

The global garments industry is closely controlled by brand names and retailers, who relentlessly squeeze suppliers in producing more cheaply. Unsurprisingly, working conditions in this sector are characterised by super-exploitation with a disregard for issues such as health and safety.  The recent collapse of the Rana Plaza factory in Bangladesh, when more than 1000 people were killed is only one of the most extreme examples of the consequences of poor working conditions in this sector. In relation to food production, ‘as with the garments sector, the production, distribution and consumption of food are already dominated by a small number of giant transnational corporations who seek to determine what is grown and what is eaten in all corners of the globe. As with the extractive sector, capital has become increasingly aggressive in its attempts to appropriate the natural resources necessary for its further expansion: land, seeds, water and the genetic building blocks of life itself’ (P.118). In short, global capitalism has intensified exploitation across borders with the peoples of the Global South bearing yet again the brunt of the onslaught. 

The rise of the BRICS and CSR as hopes for alternatives?

John Hilary dismisses hopes that the rise of the BRICS, Brazil, Russia, India, China and South Africa, will result in a dramatic change in global capitalism. Yes, the balance of power in the global economy is changing, but capitalism itself has not been undermined. ‘Instead of the traditional division between the capital-exporting countries of the North and the capital-importing countries of the South, the increasing accumulation of capital in the semiperiphery has generated a new wave of imperialism from the emerging economies themselves’ (P.34). At the same time inequality across the globe is increasing between countries, but also within countries and the BRICS are no exception here. ‘In the emerging economies of India and China, similar increases in inequality have taken place against the backdrop of hundreds of millions living in absolute poverty (P.18). Interestingly, the position of transnational capital has actually been strengthened rather than weakened as a result of the rise of the BRICS. ‘The G20’s decision to resurrect the failed institutions of twentieth-century globalization in the interests of transnational capital represents the greatest structural continuity between the new world order and the old’ (P.29).

John Hilary is equally clear in his dismissal of Corporate Social Responsibility (CSR) schemes as a way of self-regulation by transnational capital. ‘For all its claims to be channelling the power of business in pursuit of humanity’s common goals, CSR has successfully undermined the very cause it purports to serve’ (P.59). Instead of constraining capital and ensuring good working conditions for workers, CSR actually legitimises current practices of exploitation. The fact that many NGOs have collaborated with capital in this area makes the situation worse. This ‘has contributed to the closing down of critical space, as corporations have been able to point to their partnerships with “respectable” civil society (especially NGOs from the global North) as a means of marginalizing more radical opposition to their operations or to the system as a whole’ (P.79).

What alternatives beyond capitalism?

Photo by seven-resist

Importantly, John Hilary does not stop with criticising hopes linked to the BRICS and CSR. He also attempts to identify real moments of alternatives. Unlike many liberal commentators of the current situation, he is fully aware of the impossibility of regulatory changes. Real change can only be brought about, if global capitalism itself is challenged (P.117). His thinking is organised around three concepts: popular sovereignty, common ownership, and social production. ‘The concept of sovereignty is essentially opposed to the disempowerment inherent in corporate globalization, in that it reclaims authority over natural resources and the means of production from transnational capital, relocating legitimate authority within the democratic structures of the community, however constructed and contested (P.131). Common ownership can galvanise the resistance against the new wave of enclosures reflected in ‘land grabbing’ and social production allows the production for use, not for profit. These concepts are positively supported with a whole range of examples from Latin American countries, where the so-called ‘pink tide’ of centre-left and left governments has resulted in measures of significant wealth re-distribution from Lula’s Brazil and Morales’ Bolivia to Hugo Chavez’s ‘new socialism’ in Venezuela. 

As important as all these examples of change are, it is this aspect of the book where I find myself in slight disagreement with John Hilary. I am not convinced that the majority of the ‘global justice movement’ has declared itself opposed to capitalism as such rather than criticising the most negative outgrowths of neo-liberalism. Nor does the re-emergence of the state as an important actor of development in Latin America point towards a future beyond capitalism. As John Hilary acknowledges himself, at the national level ‘several of the “pink” governments have actually augmented the power of capital both nationally and internationally, maintaining their socially progressive credentials through pro-poor welfare programmes, but at the expense of any structural change’ (P.146). Capitalism as such is not challenged. Is John Hilary slightly too optimistic when assessing the current potential for moves beyond capitalism? Perhaps, but then there are many studies simply re-asserting the dominance of capitalism. In a way, it is refreshing that The Poverty of Capitalism goes into the opposite direction.

Photo by Sterneck

When looking at all the examples of transformative change mentioned by John Hilary, perhaps it is the movement around food sovereignty, demanding that people can decide for themselves what to grow and for whom, which directly challenges corporate power and may include the seeds for a different world. The peasant farmers’ movement La Via Campesina organises 150 local and national organisations from 70 countries and ensures a strong presence of this movement at the international level. Demands for ecological, sustainable, local and self-determined agriculture find support in the Global North and South alike.

The struggle over the future world order is open ended. It is these struggles, which can function as vehicles, ‘by which to develop an international class consciousness over and against the very real challenges posed by globalization to transnational solidarity’ (P.116). Solidarity is always the result of concrete struggles, and it is in this respect, that John Hilary’s positive assessment of the current situation may be justified. Hence, to conclude with his words, ‘the struggle for alternatives beyond capitalism is what makes another world possible. Even in the midst of crisis, that world is already coming into view’ (P.161). 

An impressive book, a must read for all those interested in transformative change beyond capitalism!

Prof. Andreas Bieler

Professor of Political Economy

University of Nottingham/UK

Andreas.Bieler@nottingham.ac.uk

Personal website: http://andreasbieler.net

12 November 2013