The underlying assumption of those who fear that a Syriza government
would provoke some kind of Chile style coup, were they to stick to
the anti-austerity agenda, is that such a social-democratic programme
is inherently incompatible with the interests of capital. But,
clearly that is no more the case than was it the case when the US
Democrats adopted such a programme, after 2008, as indeed did almost
every other government, prompting arch-Thatcherite, Samuel Brittain,
to write in the FT at the time, “We are all Keynesians now.”
If such Keynesian, as opposed to
Monetarist, intervention poses such an existential threat to capital,
why is it that between 1945 and 1976, such intervention was the
bedrock of economic policy, not just of social-democratic
governments, but even of conservative governments, working within the
parameters of the social-democratic state? In fact, even after Monetarism became the chosen method of intervention, for conservative
government's, fiscal intervention continued to be an important policy
tool. The Thatcher-Major government's from 1979-97, ran a budget
deficit to GDP ratio that was, on average, double that during the
Blair-Brown government's from 1997-2007, for example.
If such Keynesian, as opposed to
Monetarist, intervention poses such an existential threat to capital,
why is it that between 1945 and 1976, such intervention was the
bedrock of economic policy, not just of social-democratic
governments, but even of conservative governments, working within the
parameters of the social-democratic state? In fact, even after Monetarism became the chosen method of intervention, for conservative
government's, fiscal intervention continued to be an important policy
tool. The Thatcher-Major government's from 1979-97, ran a budget
deficit to GDP ratio that was, on average, double that during the
Blair-Brown government's from 1997-2007, for example.
It is not capital whose interests
are threatened, by the use of the kind of Keynesian policies being
promoted by Syriza, but only the interests of a specific section of
capital, i.e. of interest-bearing capital, whose actions over the
last 30 years, in blowing up huge financial bubbles, have created the
current debt crisis. It is those interests that conservative
governments are defending, not the interests of capital in general,
and certainly not those of big industrial capital. As Marx points
out.
“As regards the fall in the purely nominal capital, State bonds, shares etc.—in so far as it does not lead to the bankruptcy of the state or of the share company, or to the complete stoppage of reproduction through undermining the credit of the industrial capitalists who hold such securities—it amounts only to the transfer of wealth from one hand to another and will, on the whole, act favourably upon reproduction, since the parvenus into whose hands these stocks or shares fall cheaply, are mostly more enterprising than their former owners.”
(Theories Of Surplus Value, Part 2, p 496)
Moreover, as Marx pointed out, in relation to the misguided bank legislation of the 1844 Bank Act, the influence of these interests, at particular times, in shaping policy, leads, as Marx puts it, to the defence of scraps of paper, at the expense of large scale destruction of real productive-wealth. From the perspective of big industrial capital, the writing off of large amounts of fictitious capital – debt – represents no bad thing, no destruction of real wealth producing productive-capital. Quite the contrary, it creates the potential for the exact opposite.
“As regards the fall in the purely nominal capital, State bonds, shares etc.—in so far as it does not lead to the bankruptcy of the state or of the share company, or to the complete stoppage of reproduction through undermining the credit of the industrial capitalists who hold such securities—it amounts only to the transfer of wealth from one hand to another and will, on the whole, act favourably upon reproduction, since the parvenus into whose hands these stocks or shares fall cheaply, are mostly more enterprising than their former owners.”
(Theories Of Surplus Value, Part 2, p 496)
Moreover, as Marx pointed out, in relation to the misguided bank legislation of the 1844 Bank Act, the influence of these interests, at particular times, in shaping policy, leads, as Marx puts it, to the defence of scraps of paper, at the expense of large scale destruction of real productive-wealth. From the perspective of big industrial capital, the writing off of large amounts of fictitious capital – debt – represents no bad thing, no destruction of real wealth producing productive-capital. Quite the contrary, it creates the potential for the exact opposite.
"... the reduction of the money equivalents of these securities on the stock exchange list has nothing to do with the actual capital which they represent, but very much indeed with the solvency of their owners."
(Capital III, Chapter 30)
And that is what economies like Greece, and
others in the periphery require, as a starting point to establishing
economies that can grow, and compete within the global economy. In
fact, that kind of approach followed by US social democracy, in the
face of opposition by conservative forces such as the Tea Party, is
precisely what the EU economy requires here and now. It is why the
US economy has recovered, and is growing at around 3-3.5% on a
longer term basis, and between 4-5% currently.
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